Given this situation, since the MPM held on May 19 and 20, 2005, the Bank has been allowing a temporary fall of the outstanding balance below the target range when it is judged, in the situation where the Bank is doing its utmost to provide funds while at the same time giving due consideration to the effects on the functioning of the market, that financial institutions' liquidity demand is exceptionally weak.
And since applying these instruments could mean, for example, that it becomes harder for some to qualify for a mortgage, policymakers might be reluctant to use them. In order for monetary policy to fulfil its mandate and to ensure clear accountability, it’s important that price stability remains the primary objective of monetary policy.