The Act established the operational independence of the Reserve Bank (Bank) in respect of monetary policy, and specified price stability as the single monetary policy objective. A month later, the Minister of Finance and the Governor signed the first Policy Targets Agreement, which specified an annual inflation target of 0 to 2 percent.
That’s why we are examining the potential of reviewing the definition of price stability, monetary policy instruments and their effects (both main effects and potential side effects), as well as our communication practices. In a long-term outlook, we are also going to assess the importance of digitalization, financial stability, globalization, and climate change from the perspective of monetary policy.