Bank of Japan policymakers decided at a June 28 meeting to keep in place the "zero-interest-rate" policy and check economic data to reaffirm a recovery before ending the policy, according to minutes of the meeting released Wednesday.
The minutes revealed that most of the BOJ's nine Policy Board members, citing an improvement in capital spending and income, said the Japanese economy is steadily approaching the point where an end to deflationary concerns is foreseeable.
But a majority of them said the central bank needed to examine upcoming economic indicators, including its "tankan" quarterly business confidence survey that was due out July 4, to confirm the extent to which corporate spending on plants and equipment had improved and whether employment and income had stopped deteriorating, according to the minutes.
The BOJ had argued it would maintain the "zero-interest-rate" policy, which was initiated as an emergency measure in February 1999, until deflationary concerns were dispelled.
The members discussed the relationship between the planned end of the policy and the government's fiscal policy. Many said that even after the policy was scrapped, monetary conditions would remain stimulative to the economy if the rate change were small, the minutes say.