Bills sold were safe and had no default risk. This string of trading ultimately had the effect that the Bank of Japan became the counterparty of both Japanese and foreign banks, thereby promoting smooth dollar funding for Japanese financial institutions. The stock purchasing program The third measure, introduced in 2002, is the Bank of Japan’s purchase of stocks held by commercial banks.
Once the impact of the pandemic fades, a recovery in demand, supported by accommodative fiscal and monetary policies, will put upward pressure on inflation over the medium term. Marketbased indicators and survey-based measures of longer-term inflation expectations remain broadly unchanged at low levels.