Investing.com - The Bank of Japan board was divided over how a policy target shift would support a path toward stable 2% inflation, the summary of opinions expressed at its Sept. 20-21 meeting released Friday showed.
The BoJ decided to add control of the bond yield curve to its aggressive monetary easing, an attempt to undo some of the effects of its negative interest rate policy, which caused an excessively sharp flattening of the curve.
According to Friday's summary, one member said, "Compared with the previous framework, the new policy framework with yield curve control placed at the core will enable the BOJ to make more flexible adjustments according to economic, prices, and financial developments, and will enhance the sustainability of monetary easing."
And another member suggested the outcome needed further explanation
"It is a natural consequence that the amount of the BoJ's JGB purchases may fluctuate, either upward or downward, to achieve the target level of a long-term interest rate specified by the guidelines for market
operations," the member said, adding the BoJ should explain that such a change in the amount of JGB buying would have no policy implications.
The bank last week dropped the politically sensitive "negative interest rate" from the name of its policy framework - until the change, the policy was called "Quantitative and Qualitative Monetary Easing With a Negative Interest Rate."
The new framework also features an "inflation-overshooting commitment" in which the BoJ commits itself to expanding the monetary base until the year-on-year rate of increase in the consumer price index exceeds its inflation target of 2% and stays above the target "in a stable manner."
The summary of opinions didn't identify who said what.