On the basis of a year-on-year rate of change in the CPI, each Policy Board member’s “understanding” falls in a positive range of 2 percent or lower, and the midpoints of most Policy Board members’ “understanding” are around 1 percent. In other words, the Bank provided clarification of the time horizon of the virtually zero interest rate policy.
And third, given that there was little room for a further decline in short-term interest rates, the Bank established a program on its balance sheet to purchase various financial assets, such as government securities, ETFs, and Japan real estate investment trusts (J-REITs), to encourage a decline in longer-term interest rates and various risk premiums.