Large-scale asset purchases and related communication Because of the severity of the recession and the disruptions in financial markets, and because short-term interest rates were near the zero lower bound, it became clear early on that more monetary accommodation would be needed than could be provided through the management of short-term rates alone, even with guidance that those rates would be kept low well into the future.
In order for Japan’s economy to achieve sustainable economic growth with price stability, the Bank welcomes these initiatives, which are indeed timely. In addition, the Bank believes that highly accommodative financial conditions under “QQE with a Negative Interest Rate” and the government’s policies will exert synergy effects on the economy (Chart 6 [2]).