In order for the model to work, human capital invested by young workers in their firm needs to yield future dividends by contributing to corporate growth; to this end, sustainable growth in corporate sales is necessary. In reality, however, due to prolonged deflation, many firms were forced to lower their growth expectations and were less likely to see sustainable growth in their sales.
At the MPM held on November 1, the Bank decided to maintain the guideline for market operations in which the short-term policy interest rate is set at minus 0.1 percent and the target level of 10-year JGB yields is set at around zero percent.