Mar 20 (Kyodo) - The Bank of Japan on Friday tweaked its policy framework to continue with monetary easing in more sustainable and effective ways as economic recovery from the pandemic is still nascent and its inflation target is far off.
After a review at a two-day policy meeting, the BOJ dropped its annual target of buying 6 trillion yen ($55 billion) in exchange-traded funds and said it will step up purchases only in times of market turmoil with its ceiling kept at around 12 trillion yen.
The BOJ maintained its "yield curve control" keeping short-term interest rates at minus 0.1 percent and guiding 10-year Japanese government bond yields around zero percent.
But more fluctuations can be tolerated now with the yields allowed to move up or down by around 0.25 percentage point from zero, wider than the previous 0.2 percent, the bank said in a post-meeting statement.
The current easing framework has done little to accelerate inflation toward a 2 percent target since its launch in 2016. The BOJ sought through the latest review to address the adverse effects of keeping interest rates low for an extended period and aggressively buying assets.
