Minutes of the Monetary Policy Meeting

on March 15 and 16, 2005
(English translation prepared by the Bank's staff based on the Japanese original)

May 9, 2005
Bank of Japan

A Monetary Policy Meeting of the Bank of Japan Policy Board was held in the Head Office of the Bank of Japan in Tokyo on Tuesday, March 15, 2005, from 1:59 p.m. to 4:06 p.m., and on Wednesday, March 16, from 9:00 a.m. to 12:39 p.m.¹

Policy Board Members Present Mr. T. Fukui, Chairman, Governor of the Bank of Japan
Mr. T. Muto, Deputy Governor of the Bank of Japan
Mr. K. Iwata, Deputy Governor of the Bank of Japan
Mr. K. Ueda
Ms. M. Suda
Mr. S. Nakahara
Mr. H. Haru
Mr. T. Fukuma
Mr. A. Mizuno

Government Representatives Present Mr. R. Tanose, Senior Vice Minister of Finance, Ministry of Finance²
Mr. M. Ishii, Deputy Vice Minister for Policy Planning and Coordination, Ministry of Finance³
Mr. J. Hamano, Director General for Economic and Fiscal Management, Cabinet Office
Reporting Staff Mr. E. Hirano, Executive Director (Assistant Governor)⁴
Mr. M. Shirakawa, Executive Director
Mr. A. Yamamoto, Executive Director
Mr. H. Yamaguchi, Director-General, Monetary Affairs Department
Mr. M. Ayuse, Deputy Director-General, Monetary Affairs Department⁵
Mr. S. Uchida, Senior Economist, Monetary Affairs Department
Mr. H. Yamaoka, Senior Economist, Monetary Affairs Department
Mr. H. Nakaso, Director-General, Financial Markets Department
Mr. H. Hayakawa, Director-General, Research and Statistics Department
Mr. K. Momma, Deputy Director-General, Research and Statistics Department
Mr. A. Horii, Director-General, International Department
Secretariat of the Monetary Policy Meeting Mr. K. Akiyama, Director-General, Secretariat of the Policy Board
Mr. T. Takei, Adviser to the Governor, Secretariat of the Policy Board
Mr. K. Murakami, Director, Secretariat of the Policy Board
Mr. Y. Yamada, Director, Monetary Affairs Department⁵
Mr. K. Masaki, Senior Economist, Monetary Affairs Department
Mr. A. Shinmi, Senior Economist, Monetary Affairs Department
Mr. T. Sakamoto, Director, Financial Markets Department⁵

The minutes of this meeting were approved by the Policy Board at the Monetary Policy Meeting held on April 28, 2005 as "a document which contains an outline of the discussion at the meeting" stipulated in Article 20, Paragraph 1 of the Bank of Japan Law of 1997. Those present are referred to by their titles at the time of the meeting.
Mr. R. Tanose was present on March 16.
Mr. M. Ishii was present on March 15.
Mr. E. Hirano was present on March 16.
Messrs. M. Ayuse, Y. Yamada, and T. Sakamoto were present on March 16 from 9:00 a.m. to 9:17 a.m.

I. Summary of Staff Reports on Economic and Financial Developments⁶

A. Money Market Operations in the Intermeeting Period

The Bank conducted market operations in accordance with the guideline decided at the previous meeting on February 16 and 17, 2005.⁷ The outstanding balance of current accounts at the Bank moved in the 30-35 trillion yen range.

6Reports were made based on information available at the time of the meeting.
7The guideline was as follows:
The Bank of Japan will conduct money market operations, aiming at the outstanding balance of current accounts held at the Bank at around 30 to 35 trillion yen.
Should there be a risk of financial market instability, such as a surge in liquidity demand, the Bank will provide more liquidity irrespective of the above target.

B. Recent Developments in Financial Markets

Against the background of the Bank's provision of ample liquidity, the weighted average of the uncollateralized overnight call rate was at around zero percent. Interest rates on term instruments generally remained steady at low levels. The amount of funds outstanding in the uncollateralized call market was growing due to an increase in funds raised by foreign banks and other financial institutions.

Japanese stock prices showed steady developments as U.S. stock prices had been firm and views about the economic outlook had become less cautious reflecting the release of stronger-than-expected Japanese economic indicators. The Nikkei 225 Stock Average was recently moving in the range of 11,500-12,000 yen.

Long-term interest rates had risen reflecting the stronger-than-expected economic indicators. Recently, they were moving in the range of 1.45-1.50 percent.

The yen fluctuated within a limited range against the U.S. dollar. Recently, it was being traded in the range of 103-106 yen, almost the same level as at the time of the previous meeting.

C. Overseas Economic and Financial Developments

The U.S. economy continued to expand. Private consumption and business fixed investment continued to increase, and the number of employees was on an improving trend. The growth rate of real GDP on an annualized quarter-on-quarter basis for the October-December quarter of 2004 was revised upward to 3.8 percent, almost the same rate as for the July-September quarter. The inflation rate was rising at a slow pace.

In the euro area, there were signs that exports would recover in the near future, but the momentum for economic recovery was weak as sluggishness in production and employment persisted.

As for East Asian economies, in China both domestic and external demand continued to expand strongly. The NIEs and ASEAN economies continued to expand at a moderate pace.

Turning to U.S. and European financial markets, long-term interest rates rose mainly due to the release of stronger-than-expected economic indicators and a rise in crude oil prices. Stock prices in the United States and Germany declined through late February, but were generally on an upward trend thereafter reflecting expectations that their economies would expand.

In financial markets in many emerging economies, the yield differentials between their sovereign bonds and U.S. Treasuries narrowed and stock prices were rising steadily.

D. Economic and Financial Developments in Japan

1. Economic developments

Exports were starting to pick up because supply-demand adjustments in IT-related sectors had been making gradual progress and overseas economies had been on an expanding trend. Exports showed a relatively high growth of 2.7 percent in January from the monthly average of the October-December quarter of 2004 due partly to an upsurge in exports to China reflecting special factors. Exports of IT-related goods were beginning to pick up. As for the outlook, exports were projected to increase, but the pace of increase was likely to be moderate because global IT-related demand was unlikely to grow as fast as during the rapid increase in the first half of 2004.

Although the Financial Statements Statistics of Corporations by Industry, Quarterly suggested a pause in the growth of corporate profits in the October-December quarter, they were still on an improving trend overall, with downward revisions of earnings forecasts limited to some IT-related firms.

Business fixed investment had been on a rising trend, particularly in manufacturing industries, although some indicators, for example, the Financial Statements Statistics of Corporations by Industry, Quarterly and machinery orders, were somewhat weak. According to the Financial Statements Statistics of Corporations by Industry, Quarterly, business fixed investment decreased by 5.2 percent in the October-December quarter on a quarter-on-quarter basis, but this decline was mainly caused by the decrease in investment by small and medium-sized nonmanufacturing firms in reaction to the upsurge during the first half of 2004, and investment by manufacturing firms had been on a steady uptrend. Shipments of capital goods (excluding transport equipment), a coincident indicator of machinery investment, had increased sharply in January, following an increase in the October-December quarter. Moreover, although machinery orders (private demand, excluding shipbuilding and orders from electric power companies), a leading indicator of machinery investment, inched down in January after rising by 6.0 percent in the October-December quarter on a quarter-on-quarter basis, forecasts indicated that they would increase in the January-March quarter. Business fixed investment was expected to remain on an increasing trend, since domestic and external demand, as well as corporate profits, were projected to increase.

Private consumption had been steady. Sales at department stores and supermarkets were strong in January, particularly for winter apparel. The number of new passenger-car registrations remained firm, and sales of electrical appliances, particularly digital appliances, continued to trend steadily upward. Private consumption was likely to recover gradually, as household income was expected to show signs of a gradual increase.

Production had been more or less flat, as inventory adjustments continued in IT-related sectors. Industrial production showed a relatively large increase of 2.5 percent in January from the monthly average of the October-December quarter, after being somewhat weak for the July-September and the October-December quarters. The rise in industrial production had been partly boosted by temporary factors, but production of transport equipment was increasing and that of electronic parts and devices had gradually stopped declining. As for the outlook, production was expected to increase. This was based on the projection that, although the effects of inventory adjustments in IT-related sectors would continue for some time, overseas economies would continue to grow and the foundation for a recovery in domestic demand would be solid.

As for the employment and income situation, job offers and the unemployment rate had been improving, and the number of employees was on an uptrend. Wages were still on a modest downtrend in terms of the average per person, but special payments had been increasing recently. Judging from these developments and the increase in the number of employees, it was clear that household income had stopped declining. While firms were likely to continue restraining labor costs, household income was expected to show signs of a gradual increase since corporate profits were increasing and the extent of excess labor as perceived by firms was continuing to fall.

On the price front, international commodity prices, particularly those of crude oil and nonferrous metals, were rising. Against this background, prices of domestic commodities, namely petroleum products and nonferrous metals, were increasing somewhat. Domestic corporate goods prices had recently been somewhat weak, as crude oil prices fell back temporarily toward the end of 2004. However, looking forward, domestic corporate goods prices were likely to start increasing again, reflecting the rise in commodity prices at home and abroad. Consumer prices (excluding fresh food) had been declining slightly on a year-on-year basis. The year-on-year rate of decline accelerated slightly in January compared to December, posting a decrease of 0.3 percent, reflecting the reduction in electricity and telephone charges against the background of deregulation. As for the outlook, consumer prices were projected to continue falling slightly on a year-on-year basis, partly because the effects of the reduction in electricity and telephone charges would continue.

2. Financial environment

The environment for corporate finance was becoming more accommodative on the whole. The improvement in credit demand in the private sector seemed to have stopped temporarily, in an environment where firms continued to reduce their debts. The rate of decline in lending by private banks, however, had been diminishing at a moderate pace. The lending attitude of private banks was becoming more accommodative, and that of financial institutions as perceived by firms, including small firms, had also been improving.

With regard to financing through capital markets, the issuing environment for CP and corporate bonds continued to be favorable, and the amount outstanding of CP and corporate bonds issued continued to be above the previous year's level. In the secondary market, credit spreads on corporate bonds, including those with low credit ratings, had been at very low levels.

The year-on-year growth rate of the monetary base had been at the 1.0-2.0 percent level, and that of the money stock (M2+CDs) continued to be around 2.0 percent.

II. Amendment to Guidelines on Eligible Collateral and Principal Terms and Conditions for the Purchase of CP with Repurchase Agreements

A. Staff Proposal

Given that more market participants were likely to shift from using paper CP to using dematerialized CP, the staff proposed that the Bank amend Guidelines on Eligible Collateral and Principal Terms and Conditions for the Purchase of CP with Repurchase Agreements to accept yen-denominated dematerialized CP issued by foreign corporations with domestic corporation guarantees as eligible collateral for the Bank's provision of credit and to include such CP in the range of eligible assets for CP purchase operations with repurchase agreements.

B. Discussion by the Policy Board and Vote

Members voted unanimously to approve the proposal and agreed that the decision should be made public.

III. Summary of Discussions by the Policy Board on Economic and Financial Developments

A. Economic Developments

On the current state of Japan's economy, members concurred that, although the economy was still at a pause, the recovery mechanism continued to operate as seen in the fact that production, which had been somewhat weak, was starting to show signs of recovery with adjustments in IT-related sectors making gradual progress. They also agreed that the economy would continue to recover and gradually move to a sustainable growth path.

Members agreed that overseas economies, particularly those of the United States and China, continued to expand.

Many members expressed the view that the U.S. economy continued to expand, mentioning the following as the main reasons for their view. First, the growth rate of real GDP for the October-December quarter had been revised upward. Second, management had a stronger appetite for business fixed investment, and the number of employees had been increasing. And third, stock prices had been firm. A few members said that in this situation producer prices were rising for a wide range of items, and thus future movements in the inflation rate and developments affecting it, including firms' attempts to pass through higher costs, should be closely monitored. One member noted that if productivity growth in the United States slowed, a rise in materials prices might cause overall prices to rise. Therefore, future movements in the inflation rate and their effects on financial markets would require close attention.

Some members said that the Chinese economy continued to expand strongly with fixed asset investment continuing to increase at a relatively fast pace. One of these members commented that the effects of supply-side constraints such as a shortage of electricity might increase in the future. Another member said that it was important that the problem of excessive liquidity be dealt with appropriately to maintain sustainable economic growth.

With the continuing expansion of overseas economies, members agreed that Japan's exports were starting to pick up from being more or less flat, and would be on a rising trend. Some members noted that exports of IT-related goods such as semiconductor manufacturing equipment, electronic parts, and liquid crystal displays, all of which had been showing weakness, were starting to recover, while overall exports in January rose from the monthly average of the October-December quarter.

Members agreed that production had been more or less flat mainly due to the ongoing inventory adjustments in IT-related sectors. Many members noted that it posted an increase in January from the monthly average of the October-December quarter, and, for the outlook, they expressed the view that production would increase mainly for the following reasons. First, there were signs that production of electronic parts and devices, which had been somewhat weak, had stopped declining, and inventory adjustments of these items were making gradual progress. And second, the production forecast index suggested that production would increase in the January-March quarter.

Many members made other points regarding adjustments in IT-related sectors. One member pointed out that worldwide shipments of semiconductors showed relatively high growth in January, and that shipments of IT-related final goods were increasing, particularly in Asia. Some members noted that, although the degree of progress differed according to the type of product, inventory adjustments in IT-related sectors were generally making steady progress, and also expressed the view that it was becoming more likely that they would be completed by around spring 2005. One member said that future developments in the semiconductor industry continued to require close monitoring, since the degree of progress in inventory adjustments differed according to the stage of the manufacturing process, and the book-to-bill ratio--the ratio of orders to shipments--of semiconductor manufacturing equipment in North America, a leading indicator for IT-related sectors, declined in January. With regard to the outlook for a recovery in IT-related demand after the completion of the inventory adjustments in IT-related sectors, a few members expressed the view that it was unlikely to grow as fast as during the rapid increase in the first half of 2004 and that its pace of recovery would be moderate.

Many members expressed the view that business fixed investment had been on a rising trend, particularly in manufacturing, based on the following developments. First, although somewhat weak movements were observed in, for example, the Financial Statements Statistics of Corporations by Industry, Quarterly and the GDP statistics for the October-December quarter, shipments of capital goods showed relatively high growth. And second, machinery orders and construction starts, leading indicators of business fixed investment, continued their uptrend. These members said that it was expected that the increasing trend in business fixed investment would continue as corporate profits would remain on an uptrend. One member added that the pace of increase in business fixed investment through fiscal 2006 was likely to be moderate given the current phase in the capital stock cycle in Japan. A few members said that developments in firms' business fixed investment plans should be reexamined based on the survey results in the March Tankan (Short-Term Economic Survey of Enterprises in Japan), particularly the plans of small and medium-sized firms in nonmanufacturing whose investment figures were relatively weak in the Financial Statements Statistics of Corporations by Industry, Quarterly.

With regard to the employment and income situation, members concurred that it was clear that household income had stopped declining, since the number of employees was on an uptrend as indicators reflecting labor market conditions, such as job offers and the unemployment rate, continued to improve, and wages had almost stopped falling, as evidenced by positive developments such as an upturn in winter bonuses. One member pointed out that some firms were changing their stance on employment, as seen in an increase in the number of new graduates firms had recruited and reemergence of a preference for hiring regular employees rather than part-time workers. A different member added that the ratio of job offers to applicants with specialized skills was increasing, as was the proportion of high school and college students who had received job offers, and the pace of increase in the proportion of part-time workers was slowing. In relation to this, one member commented that whether the recent slowdown in the pace of increase in the proportion of part-time workers could be described as a trend was significant for forecasting future developments in wages and prices, and therefore it was necessary to closely watch future developments. A different member said that the continuing tendency of firms to restrain labor costs was not weakening.

Members concurred that private consumption had been steady, as seen in the fact that sales at department stores and supermarkets were strong in January, particularly for winter apparel, as it was clear that household income had stopped declining. One member said that positive developments in many indicators related to private consumption in January supported to a certain extent the view that somewhat weak movements in the October-December quarter were due to temporary factors, such as adverse weather and natural disasters. A different member commented that although private consumption had been steady, some time was still required before confirming whether it would continue to improve.

On prices, members agreed that, although domestic corporate goods prices had recently been somewhat weak as the price of crude oil fell back temporarily toward the end of 2004, they were likely to start increasing again reflecting the rise in commodity prices at home and abroad. Members also concurred that consumer prices had been declining slightly on a year-on-year basis, and that they would continue to do so partly because the effects of the reduction in electricity and telephone charges would continue.

Many members commented on the increase in prices of crude oil and materials, and its effects on consumer prices. Some members said that in addition to an increase in demand reflecting the economic expansion worldwide, a considerable volume of speculative inflow of funds to commodity markets might be a factor behind the recent rise in prices of international commodities such as crude oil. Many members expressed the view that the effects of the increase in prices of materials on consumer prices had so far been limited, mainly because the increase was absorbed by the corporate sector with the decline in unit labor cost. A few members, however, said that developments in materials prices and their effects on corporate profits and consumer prices would require close monitoring, as it was clear that compensation of employees had stopped declining recently.

B. Financial Developments

On the financial front, members agreed that the financial environment remained extremely accommodative.

Some members said that despite the upcoming full removal of blanket deposit insurance in April, there had been no substantial shift of funds between deposits at different financial institutions in a situation where anxieties about the financial system were subsiding. Moreover, developments in interest rates on term instruments and the yield differentials between bonds issued by banks and the Japanese government suggested that market participants were not particularly concerned about risks arising from the full removal of blanket deposit insurance.

A few members expressed the view that long-term interest rates worldwide were stable at low levels mainly due to stable inflationary expectations. They added, however, that the effects on the U.S. bond market of developments in the U.S. inflation rate and of any change in the policy stance of the Federal Reserve should be watched carefully. In relation to this, one member said that real long-term interest rates might have been declining in the United States, as inflationary expectations were increasing. A different member said that the low and stable long-term interest rates worldwide also reflected the structural factor that institutional investors, such as pension funds and insurance companies, were becoming more active in investing in bonds against the background of various changes, for example, changes in accounting rules.

One member commented that the recent decline in the year-on-year growth rate of the monetary base had not affected the growth rate of the money stock. This member added that, for the growth rate of the money stock to increase, it was essential that financial institutions' lending increase, and that therefore attention should be paid to future developments in lending.

IV. Summary of Discussions on Monetary Policy for the Immediate Future

On the monetary policy stance for the immediate future, members agreed that, based on the assessment of the current economic and financial situation, it was appropriate to maintain the current guideline for money market operations with the target range of "around 30 to 35 trillion yen" for the outstanding balance of current accounts at the Bank.

With regard to money market operations for the immediate future, members agreed that, although undersubscription had been observed in the Bank's market operations recently as financial institutions' liquidity demand had declined due mainly to the further decrease in anxieties about the financial system, it would be appropriate to maintain the outstanding balance of current accounts at the Bank within the current target range by devising ways to enhance its conduct of money market operations. This was based on the consideration that the full removal of blanket deposit insurance was approaching and that the economy was still at a pause. Some members said that, although more active trading in the call market might lead to a decrease in demand for funds supplied through the Bank's operations, it seemed feasible to maintain the outstanding balance within the current target range for the time being. This was because seasonal factors were projected to boost the level of the outstanding balance of current accounts at the Bank for some time and also because there was demand among financial institutions for funds with longer maturities supplied through the Bank's operations.

Many members explained their thinking with regard to the Bank's conduct of money market operations in the future.

One member expressed the view that the Bank was beginning to gain the understanding of market participants and the public about reviewing the target range for the outstanding balance of current accounts on the condition that the Bank maintained the quantitative easing policy framework based on its commitment in terms of policy duration. The member continued that if financial institutions' liquidity demand further decreased as a result of the enhanced soundness of the financial system, it would be appropriate to carefully and slowly lower the target range with close monitoring of financial market conditions and other circumstances, while making efforts to overcome deflation by firmly maintaining the quantitative easing policy framework and the effects stemming from it, namely the zero interest rate environment resulting from the Bank's provision of ample liquidity and the effects of its commitment in terms of policy duration. A different member said that, depending on future developments in financial markets, it could become difficult to maintain the current account balance within the current target range. This member expressed the view that, in such a situation, one option could be to lower the target range while ensuring that market participants and the public understood that this would not negatively affect the process of overcoming deflation.

One member expressed the view regarding the effects of the quantitative easing policy that the Bank's commitment to continue the current policy framework served as an anchor in maintaining price stability in a situation where interest rates were almost zero and that the size of the current account balance further strengthened the effects of interest rates being almost zero. A different member said it was considered that the positive effects of the Bank's commitment in terms of policy duration would increase as the economy recovered and the economic situation approached the stage where, if the Bank had not made the commitment, market participants might have expected that an exit from the quantitative easing policy was approaching. On this basis, this member said that a lowering of the target range might disturb the formation of market participants' expectations and weaken such effects. The member also commented on the Bank's recent communication of its thinking about the conduct of monetary policy that there was a view that it had led to confusion among some market participants, and therefore the Bank should communicate its thinking with the greatest care and in an appropriate manner. Another member said that a lowering of the target range in response to a decrease in liquidity demand should be considered as a technical issue rather than a policy matter and the Bank should continually explain this to market participants. In response to this, a different member added that even if such an adjustment of the target range was considered a technical issue, the Bank might face some difficulties in preventing misunderstanding outside the Bank.

Some members expressed the view that the Bank should carefully consider the above points based on an accurate assessment of economic activity and prices and careful examination of, for example, financial market conditions and financial institutions' financing activity after the full removal of blanket deposit insurance. It should also consider the possible effects of measures on, for example, the Bank's future conduct of monetary policy.

V. Remarks by Government Representatives

The representative from the Ministry of Finance made the following remarks.

(1) Although the government considered that Japan's economy was in a recovery phase on the whole, there were still some movements that could be seen as minor adjustments in its ongoing recovery. Meanwhile, deflation persisted. The effects of a recent surge in crude oil prices on the economy should also be closely monitored.
(2) Under these circumstances, the government considered that ensuring the sustainability of the economic recovery led by private demand and overcoming deflation were the important tasks to be tackled through its policy efforts together with the Bank, and that the utmost efforts to achieve these aims continued to be necessary.
(3) The government recognized that based on this view the Bank had introduced the quantitative easing policy in March 2001, and it had been raising the target for the outstanding balance of current accounts at the Bank in stages, maintaining the outstanding balance of current accounts in line with the target, and indicating its policy stance to the public.
(4) The utmost efforts to achieve sustainable economic recovery led by private demand and overcome deflation were still required. The government would therefore like the Bank to maintain the current policy and consistently give market participants and the public the message that it would firmly maintain the monetary easing policy to overcome deflation.

The representative from the Cabinet Office made the following remarks.

(1) Japan's economy was recovering at a moderate pace, while some weak movements continued to be seen. The government expected that through its policy efforts together with the Bank the economy would make progress toward overcoming deflation in fiscal 2005. The government would accelerate and expand structural reforms in each sector, in order to realize an economic growth path with a nominal growth rate of around 2 percent or higher in and after fiscal 2006.
(2) The government would like the Bank to continue with its current monetary easing in order to ensure that deflation was overcome, communicating closely with the government. In overcoming deflation, it was essential that the money stock increase in the end, and the government would therefore like the Bank to implement more effective monetary policy through effective provision of liquidity. The government would also like the Bank to clearly present a path toward overcoming deflation, as part of further efforts to enhance the transparency of the conduct of monetary policy.

VI. Votes

Based on the above discussions, members considered that it was appropriate to maintain the current guideline for money market operations with the target for the outstanding balance of current accounts at the Bank at around 30 to 35 trillion yen.

To reflect this view, the chairman formulated the following proposal and put it to the vote.

The Chairman's Policy Proposal on the Guideline for Market Operations:

The guideline for money market operations in the intermeeting period ahead will be as follows, and will be made public by the attached statement (see Attachment 1).

The Bank of Japan will conduct money market operations, aiming at the outstanding balance of current accounts held at the Bank at around 30 to 35 trillion yen.

Should there be a risk of financial market instability, such as a surge in liquidity demand, the Bank will provide more liquidity irrespective of the above target.

Votes for the proposal: Mr. T. Fukui, Mr. T. Muto, Mr. K. Iwata, Mr. K. Ueda, Ms. M. Suda, Mr. S. Nakahara, Mr. H. Haru, Mr. T. Fukuma, and Mr. A. Mizuno.
Votes against the proposal: None.

VII. Discussion on the Bank's View of Recent Economic and Financial Developments

Members discussed "The Bank's View" in the Monthly Report of Recent Economic and Financial Developments (consisting of "The Bank's View" and "The Background"), and put it to the vote.

The Policy Board decided, by unanimous vote, the text of "The Bank's View." It was confirmed that "The Bank's View" would be published on March 16, 2005 and the whole report on March 17, 2005.⁸

8The English version of the whole report was published on March 18, 2005.

VIII. Approval of the Minutes of the Monetary Policy Meeting

The Policy Board approved unanimously the minutes of the Monetary Policy Meeting of February 16 and 17, 2005 for release on March 22, 2005.

IX. Approval of the Scheduled Dates of the Monetary Policy Meetings in April-September 2005

At the end of the meeting, the Policy Board approved the dates of the Monetary Policy Meetings to be held in the period April-September 2005, for immediate release (see Attachment 2).

Attachment 1
March 16, 2005
Bank of Japan

At the Monetary Policy Meeting held today, the Bank of Japan decided, by unanimous vote, to set the following guideline for money market operations for the intermeeting period: