- Bank of Japan
Bank of Japan policy makers were confident the world's third biggest economy is recovering, but some were concerned about a continued slowdown in consumer inflation, the minutes of the March meeting showed. The BoJ voted to keep monetary policy intact, as officials decided to refrain from any additional surprises that could fuel additional volatility in the domestic and global markets. However, some officials voiced worries over signs of "adverse effects" of negative interest rates, which added to "anxiety among "financial institutions and depositors". They also highlighted that the measure had "exacerbated" market volatility and created "excessive expectations for further monetary easing." The BoJ introduced negative interest rates in January, joining the Euro zone, Sweden, Denmark and Switzerland in adopting the unconventional policy. Since then, Japan has slipped back into deflation, adding further doubts about Abenomics. With Japan sliding back into deflation in March, investors widely expected the central bank to ease policy further at last month's policy meeting. The BoJ did however revised its outlook on economic growth and inflation. Policymakers were cautiously optimistic about the recovery, despite the economy shrinking in two of the past three quarters. Japan's Cabinet Office will release preliminary first quarter GDP figures next week. Japan's economy contracted at an annualized 1.1% pace in the fourth quarter.
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