The Bank of Japan (BoJ) began operating in 1882, as the nation’s central bank. The Bank’s objectives are “to issue banknotes and to carry out currency and monetary control” and “to ensure smooth settlement of funds among banks and other financial institutions, thereby contributing to the maintenance of stability of the financial system.” Public interest, transparency, excellence, integrity, and effectiveness and efficiency are Bank’s organizational principles.
The Policy Board, the Bank’s highest decision-making body, determines the guideline for currency and monetary control. Implementing monetary policy, BoJ aims to maintain price stability as it provides the foundation for the nation’s economic activity and represents the most important input in decision making for both individuals and companies. On this basis, the Bank set the “price stability target” at 2% and has made a commitment to achieving this target at the earliest possible time. Furthermore, the Bank controls the amount of funds in the money market, mainly through money market operations. The Bank supplies and absorbs funds to financial institutions depending on the current market conditions.
Monetary Policy Meetings (MPM) are held eight times a year, each time for two days. At the MPMs, the Policy Board members discuss and decide the guideline for money market operations. The monetary policy decisions are made by a majority vote of the nine members of the Policy Board, which consists of the Governor, the two Deputy Governors, and the six other members. The 31st Governor is Mr Haruhiko Kuroda.
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