When the Bank of Japan ended its 18-month-old "zero-interest-rate" policy it capped speculation over the controversial shift in monetary policy.
Defying political pressure, the BOJ decided to tilt its policy toward guiding short-term interest rates higher. In doing so, the central bank has asserted its independence as assured under the revised Bank of Japan Law of 1998. As an independent entity, the BOJ made the decision free of political influence.
The decision as such by the nine-member BOJ Policy Board must be given due regard. Still, the policy-setting panel is held fully accountable for its decision and must be prepared to explain its new policy decision in easy terms to market participants both at home and abroad.
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