Members of the Bank of Japan's monetary policy board said that it was appropriate to extend the monetary easing that has been put in place, minutes from the board's meeting on April 26 revealed on Monday.
The board intends to continue with the easing until inflation reaches the desired target of 2 percent, the minutes showed - hopefully within a period of two years as other global economies continue to recover.
"Most members expressed the view that the year-on-year rate of change in the CPI was likely to follow a rising trend, reflecting factors such as the improvement in the aggregate supply and demand balance as well as the rise in medium- to long-term inflation expectations, and it was likely to reach around 2 percent - the price stability target - toward the latter half of the projection period," the minutes said.
At the meeting, the bank held its benchmark interest rate at the record low of 0 to 0.10 percent.
It also voted to conduct money market operations so that the monetary base will increase at an annual pace of about JPY 60 to 70 trillion.
The board also emphasized that the purchase of JGBs is strictly for monetary policy, and not for the purpose of monetizing government debt.
"Some members were of the view that it was essential for the Bank to gain the public's understanding by thoroughly explaining that its JGB purchases were solely conducted for the purpose of monetary policy and reiterating that it would not monetize the government debt," the minutes said.
The BoJ also raised its forecasts for economic growth and consumer prices. Releasing its outlook for economic activity and prices, the central bank said Japan's economy is expected to return to a moderate recovery path around mid-2013.
The bank upgraded its gross domestic product forecast for fiscal 2013 to 2.9 percent growth from the January projection of 2.3 percent growth. For fiscal 2014, growth is seen at 1.4 percent, stronger than previously forecast 0.8 percent.
Year-on-year rate of change in core consumer price index, that excludes fresh food, is expected to turn positive in fiscal 2013 and remain a little higher than projected in January.
The BoJ now expects core CPI to rise 0.7 percent in fiscal 2013 percent compared with the January forecast of 0.4 percent. The outlook for fiscal 2014 was also raised and the bank expects prices to rise 3.4 percent, faster than 2.9 percent increase projected previously.
By fiscal 2015, core inflation is expected to be around 2.6 percent. Excluding the effects of a planned hike in consumption tax, consumer prices are forecast to rise 1.4 percent in fiscal 2014, higher than previous prediction of 0.9 percent.
The bank expects inflation, excluding tax hike effects, to reach 1.9 percent in fiscal 2015, close to the central bank's target of 2 percent inflation.
"Upside and downside risks could be assessed as being balanced, although uncertainty remained high, including over developments in overseas economies. Most members expressed the view that risks on the price front also could be assessed as being largely balanced, although considerable uncertainty surrounded developments in medium- to long-term inflation expectations," the minutes said.
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May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.