Bank Of Japan

The Bank of Japan is the central bank of Japan, responsible for issuing currency, setting monetary policy and maintaining financial system stability. It is headquartered in Tokyo and operates under the Bank of Japan Act, with its governor appointed by the government. The bank targets price stability and has, for much of the twenty-first century, pursued ultra-loose monetary policy, including negative interest rates and large-scale asset purchases, to combat deflation. It has also intervened in currency markets to manage yen volatility. Alongside the US Federal Reserve and the European Central Bank, it ranks among the world's most closely watched monetary authorities, given Japan's status as a major global economy. Its policy decisions influence global bond yields, carry trades and, indirectly, demand for safe-haven assets such as gold. In recent years the bank has begun a gradual shift away from decades of ultra-accommodative policy, adjusting yield-curve control settings and edging interest rates higher. Its moves are scrutinised by investors for signs of a broader policy normalisation. The bank was established in 1882, modelled partly on European central banking practice, and has since played a central role in Japan's economic development and crisis responses, including the 1990s asset-bubble collapse and subsequent deflationary period.