"Members expressed the view that it was appropriate for the Bank to continue to steadily pursue quantitative and qualitative monetary easing in accordance with the current guidelines, as such easing had been exerting its intended effects"
- BoJ minutes
The Bank of Japan released minutes from its meeting in September, which showed that the majority board members were still confident that the goal of 2% sustained inflation by fiscal 2015 will be reached and it was important to monitor inflation expectations across the nation's economy. However, there was at least one policy maker, who expressed doubts and said that the 2% goal will be difficult to hit. The central bank also reiterated its pledge to extend its aggressive monetary policy for as long as needed for maintaining the inflation goal in a stable manner. However, the BoJ admitted that inflation is likely to stay around 1.25% for some time. The central bank may be forced to step up QQE, which was initiated in April 2013 and intended to last for two years, in case demand will not be able to fully recover from the sales tax increase, thus keeping inflation considerably away from the official goal.
In the meantime, the index, which measures activity in the tertiary sector, declined a seasonally adjusted 0.1% on month in August, according to the Ministry of Economy, Trade and Industry. The industries that saw a drop in activity included scientific research, retail trade, utilities and accommodations. However, finance, recreation, communication, health care and real estate enjoyed elevated activity.
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