IMF Working Papers

Twenty Years of Unconventional Monetary Policies: Lessons and Way Forward for the Bank of Japan

By Niklas J Westelius

November 8, 2020

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Niklas J Westelius. Twenty Years of Unconventional Monetary Policies: Lessons and Way Forward for the Bank of Japan, (USA: International Monetary Fund, 2020) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

The Bank of Japan has used unconventional monetary policies to fight deflation and stabilize the financial system since the late 1990s. While the Bank of Japan’s reflation efforts have evolved over time, inflation and inflation expectations have remained stubbornly low. This paper examines the evolution of monetary policy in Japan over the past twenty years, in order to draw relevant lessons and propose ways to strengthen the Bank of Japan’s policy framework. In doing so the analysis focuses on three aspects of monetary policy: objectives and goals; policy strategies; and the communication framework. Moreover, the paper discusses coordination between monetary, fiscal, and financial policies, and how the corresponding institutional design could be strengthened.

Subject: Financial sector policy and analysis, Financial sector stability, Inflation, Inflation targeting, Monetary policy, Monetary policy frameworks, Price stabilization, Prices, Unconventional monetary policies

Keywords: Bank of Japan, BoJ staff, BoJ's inflation, BoJ's overshooting commitment, BoJ's policy, BoJ's willingness, Financial sector stability, Global, Inflation, Inflation expectation, Inflation expectations, Inflation target, Inflation targeting, Japan, JGB Holdings, Overshooting commitment, Policy objective, Policy strategy, Price stability target, Price stabilization, Unconventional monetary policies, Unconventional monetary policy, WP

Publication Details

  • Pages:

    28

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2020/226

  • Stock No:

    WPIEA2020226

  • ISBN:

    9781513560359

  • ISSN:

    1018-5941

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