Bank of Japan
| Headquarters | Nihonbashi, Chūō-ku , Tokyo , Japan |
| founding | October 10, 1882 |
| president | Haruhiko Kuroda |
| country | Japan |
| currency | |
| ISO 4217 | JPY |
| Currency reserves | 1.317 trillion US $ (2019) |
| Base loan rate | 0.30% |
| Base investment rate | 0.10% |
| Website | |
| List of central banks | |
| interest rate | height |
|---|---|
| European Central Bank (valid from: September 18, 2019) | |
| Deposit rate (deposit facility) | −0.50% |
| Base rate (main refinancing operations) | 0.00% |
| Marginal lending rate (marginal lending facility) | 0.25% |
| Swiss National Bank (valid from: June 13, 2019) | |
| SNB policy rate | −0.75% |
| Federal Reserve System (effective March 16, 2020) | |
| Federal funds rate target range | 0.0 to 0.25% |
| Primary Credit Rate | 0.25% |
| Bank of Japan (effective December 19, 2008) | |
| Discount rate (basic discount / loan rate) | 0.30% |
| Bank of England (effective March 19, 2020) | |
| Official Bank Rate | 0.1% |
| Chinese People's Bank (valid from: February 20, 2020) | |
| Discount rate (one-year lending rate) | 4.05% |
The Nippon Ginkō ( Japanese 日本 銀行 , short 日 銀 , Nichigin ), in German often with the English translation Bank of Japan (short BoJ ), less often in German translation as "Bank of Japan", is the Japanese central bank . It was founded in 1882 from eight so-called change companies and has been reorganized several times since then. Your main task is to issue notes. The central bank can use various classic central bank instruments to implement your policy. The BoJ is currently led by its General Director Haruhiko Kuroda and a steering committee.
history
History of the banking system in Japan
Until the 19th century, Japan was isolated from the outside world by the Tokugawa military government from its neighboring countries for over 200 years . In 1854, American warships forced the opening of the Japanese ports and the country was able to develop into a modern industrial state under the government of Emperor Meiji . In 1869 this set up so-called change companies ( 為 替 会 社 , kawase-gaisha ) in eight cities , with the help of which the export of goods should be facilitated. Due to distrust of the newly introduced paper money, these had to be dissolved again after a short time. After a three-year transition period in which officials studied foreign banking systems, the Tokyo government passed the “ National Bank Act ” ( 国立 銀行 条例 , kokuritsu ginkō jōrei ) in 1872 , which was based on the US National Bank Act . But even this system was unsatisfactory, with the result that the four existing national banks suffered from a shortage of funds, whereupon a central bank was set up in 1882, which soon gained the privilege to issue banknotes. This is today's “Bank of Japan”.
After the establishment
After the founding, the responsibility of the half privately owned bank was limited to domestic tasks. Settlement and control of foreign trade was reserved for the predecessor of the earlier Tōkyō Ginkō (English Bank of Tokyo ). The separation of responsibilities extended until 1942, in which the bank on May 1 of that year in accordance with the "Law on the Bank of Japan" ( 日本 銀行 法 , Nihon-ginkō-hō ; hereinafter the "Act of 1942 ”) was reorganized. The Act of 1942 strongly reflects the war situation: for example, Article 1 declares the BoJ's objectives as “the regulation of currency, control and facilitation of credit and financing, and the maintenance and promotion of the credit system, in accordance with national policy, to general economic activities to improve the national power appropriately ”. The Act of 1942 was amended several times after World War II . These changes included the establishment of the Steering Board as the BoJ's highest decision-making tool in June 1949. The Act of 1942 was completely revised in June 1997 under the two principles of “independence” and “transparency”. The revised BoJ law came into effect on April 1, 1998.
Developing the independence of the central bank
1950s and 1960s
The monetary policy of the Japanese central bank in the 1950s was characterized by inadequate preventive measures while successfully combating the consequences. Disputes between politicians from the Liberal Democratic Party (LDP), the Treasury Department (MOF) and the central bank over control of monetary policy were contained by the limits imposed by the Bretton Woods system during the 1950s and 1960s. The yen was pegged at 360 yen / dollar in 1949 and, like the major European currencies, the exchange rate could not be changed during the time of the fixed interest rate systems. However, when international balance of payments imbalances unbalanced exchange rates, monetary policy was needed to make international adjustments.
1970s
The collapse of the Bretton Woods system in the early 1970s eliminated the formal definition of exchange rate relationships in Japanese monetary policy. Domestic political conflicts then arose over who in Japan would reap the individual benefits of this newly gained political leeway. Japanese politicians used this opportunity to promote the Japanese economy through an expansive monetary policy (short-term). In 1972, Prime Minister Kakuei Tanaka eased the BoJ's monetary policy against the Central Bank Council. Tanaka was the leader of the Tanaka faction , the largest faction in the LDP. Unlike other prime ministers, Tanaka was able to push through an easing of monetary policy against the BoJ and MOF.
The results of Tanaka's loose monetary policy, compounded by the initial oil shock , have been traumatic. The inflation rate rose to 12 percent in 1973 and 23 percent in 1974, accompanied by rumors of raw material shortages and hoarding by consumers. This sobering experience put the influence of politicians on monetary policy at risk. The MOF resented Tanaka the expansionary monetary policy that Tanaka had set in motion as it had caused large budget deficits. It took the ministry a decade and a half to get rid of them and was unhappy with the results of the Tanaka reflation. The ministry was fundamentally reluctant to exert political influence on monetary policy, as this threatened the MOF's own room for maneuver in monetary policy. This experience strengthened the determination of both the MOF and the BoJ to block political interventions in the future, shattered politicians' self-esteem in the monetary area, and solidified the social consensus that politics and the monetary area are a dangerous mix.
From 1977 onwards, the BoJ set (vague) money supply targets, which symbolized the BoJ's determination to withstand political pressure against enlargement. At the time of the second oil shock, the BoJ acted swiftly to contain inflation and used the experience of the early 1970s to push its way politically. In December 1979, Director General Teiichirō Morinaga, a former official from the MOF, was replaced by Haruo Maekawa, an employee of the BoJ.
1980s
From late 1970 onwards, the BoJ's actual scope for action varied due to changes in political and economic conditions. By the early 1980s, the central bank had established itself as a significant precedent for independent money control. This should prove very useful in future conflicts between the MOF and LDP politicians. The BoJ was often pressured in the 1980s, but the BoJ's submission to politicians was no longer clear-cut.
"Big Bang"
During the “big bang” liberalization of the financial market, the government under Prime Minister Ryūtarō Hashimoto (LDP, Obuchi faction ) also strengthened the independence of Nichigin in 1998: with the new central bank law, monetary policy was formally influenced by politics and the ministerial bureaucracy over the finance ministry freed.
currency
With the Shinka-jōrei ( 新 貨 条例 , English New Currency Act ) of 1871, the Japanese currency yen was issued and established as the new single currency. The former fiefs became prefectures and their mints became private banks with the right to print and spend money. By 1882, both the Bank of Japan and these private banks could issue money. The Bank of Japan issued its first banknotes on May 18, 1885.
In 1897 Japan introduced the gold standard . This was linked to the (theoretical) obligation of the central bank to exchange cash for the corresponding amount of gold at any time.
Structure of the BoJ
The BoJ has a uniform and centralized organizational structure. The central bank has a nationwide system of 32 branches that conduct financial transactions directly with private and state banks. The BOJ is not divided into separate regional or district banks that send representatives to central management. All central decision-makers are based in the central locations in Tokyo.
The official authority of the domestic monetary policy lies formally with the steering board of the central bank. The Steering Council ( 政策 委員会 , seisaku iinkai , English policy board ) consists of the General Director ( 総 裁 , sōsai ) of the BoJ, his two deputies and six other members ( 審議 委員 , shingi iin ). The members are appointed by the cabinet with the consent of both houses of parliament for five years.
According to Article 15 of the BoJ Law, this steering committee is responsible for the most important decisions. The Chairman of the Board was regularly elected General Manager of the Bank of Japan by the voting members.
Steering Council of the BoJ Surname function appointment Haruhiko Kuroda General Manager ( 総 裁 , sōsai ) March 20, 2013 Masayoshi Amamiya Deputy General Director ( 副 総 裁 , fuku-sōsai ) 20th March 2018 Masazumi Wakatabe Deputy General Director 20th March 2018 Yutaka Harada Member of the steering committee March 26, 2015 Yukitoshi Funo Member of the steering committee July 1, 2015 Makoto Sakurai Member of the steering committee April 1, 2016 Takako Masai Member of the steering committee June 30, 2016 Hitoshi Suzuki Member of the steering committee July 24, 2017 Goushi Kataoka Member of the steering committee July 24, 2017
tasks
Core task
The main task of the BoJ is to issue banknotes, whereby the Minister of Finance, with the approval of the cabinet, sets an upper limit for the banknotes in circulation and also determines the type and scope of cover funds . The central bank's monetary policy, which responded largely passively to stagnation in the 1990s, has a significant impact on the Japanese economy.
Further tasks
- serves as the "bank of the banks" and in this function makes deposits in current accounts to close out balances and the institutions affiliated with it
- buys and sells public and private sector debt and bills
- Collection and custody activities for its affiliated institutes
- Cash and account management
- can lend / take over savings paper to the government
The credit policy is in the context of monetary policy its main instrument.
Central bank instruments
In order to implement its policy, the central bank can fall back on various classic central bank instruments:
Changes in the discount rate ( 公定 歩 合 , kōtei buai )
This shows the market participants the direction of the current credit policy. However, this access to the BoJ's refinancing resources is not unlimited. This is ensured by a flexible overall framework within which the central bank strives to fine-tune bank liquidity in day-to-day business. The dependence of the big banks on loans from the BoJ was characteristic of the Japanese financial system for a long time. In order to reduce the resulting “over-loan” situation, the central bank imposed a refinancing ceiling depending on the individual circumstances.
Open market policy
Within this framework, the BoJ acts as a buyer and seller of bills of exchange and other funds, as well as government bonds. The BoJ is traditionally well represented in the exchange market. Via so-called tanshi companies ( 短 資 会 社 , tanshi gaisha ) it acquires or sells trade and cover bills as well as central bank bills . For this purpose, the central bank calculates an interest rate that is based on the market.
Reserve requirements ( 準備 預 金 , jumbi yokin )
The BoJ has stipulated progressively staggered minimum reserve rates, which burden banks with a higher deposit volume to a relatively greater extent. However, it has lost its importance as an active instrument of monetary and credit policy.
window guidance ( 窓 口 指導 , madoguchi shidō )
This instrument is not anchored in law. This is a particularly pronounced form in Japan of the moral suasion, which is better known in Europe . These are recommendations from the central bank on loan growth. They are issued to the individual commercial banks or groups of institutions in times of a restrictive credit policy.
International role of the BoJ
The BoJ conducts activities such as foreign exchange in the area of international finance and provides support to foreign central banks and international organizations whose investments are related to the yen. It also takes part in various international discussions with foreign central banks on the state of the world economy and in measures to ensure the stability of the financial markets and improve their structure. The BoJ also conducts international operations on behalf of the government, such as processing notifications and reports required by foreign exchange and foreign trade law, compiling Japan's balance of payments statistics (BOP), and intervening in foreign exchange markets. The BoJ also assists foreign monetary authorities and international organizations with their investments and financing of the yen, by accepting yen deposits, acting as custodian for yen securities, and providing services for the settlement of Japanese government bonds.
literature
- Angelika Ernst: Money in Japan. E. Schmidt, Berlin 1981, ISBN 3-503-01978-2 .
- Gottfried Wohlmannstetter: Tokyo financial center. Knapp, Frankfurt 1991, ISBN 3-7819-1167-5 .
- C. Randall Henning: Currencies and politics in the United States, Germany, and Japan. Peterson Institute, 1994, ISBN 0-88132-127-3 .
Web links
- Bank of Japan Official Website (Japanese, English)
- How independent is the Bank of Japan?
- The long arm of the Bank of Japan extends to Europe
supporting documents
- ↑ Japan Foreign Exchange Reserves . tradingeconomics.com. Accessed on January 28, 2017 (English)
- ↑ a b Angelika Ernst: Money in Japan. E. Schmidt, 1981, pp. 153-154.
- ↑ Gottfried Wohlmannstetter: Finanzplatz Tokio Knapp, Frankfurt 1991, p. 183.
- ^ Bank of Japan: History ( Memento April 8, 2006 in the Internet Archive ), accessed November 25, 2009.
- ↑ Hugh T. Patrick: The Bank of Japan: A Case Study in the Effectiveness of Central Bank Techniques of Monetary Control in The Journal of Finance, Vol. 15, No. 4 (Dec., 1960), pp. 573-574, pp. 574, JSTOR 2325642
- ^ C. Randall Henning, Currencies and politics in the United States, Germany, and Japan , Peterson Institute, 1994, p. 77.
- ^ C. Randall Henning, Currencies and politics in the United States, Germany, and Japan , Peterson Institute, 1994, pp. 77,78.
- ↑ C. Randall Henning, Currencies and politics in the United States, Germany, and Japan , Peterson Institute, 1994, pp. 78,79.
- ^ Toshiharu Kitamura: Background to the Big Bang and Subsequent Developments in Japan. Financial Reform and Its International Implications. (PDF) (No longer available online.) Ministry of Finance , November 11, 1998, archived from the original on May 23, 2011 ; accessed on November 29, 2009 . Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice.
- ↑ Bank of Japan Annual Review 2009
- ^ C. Randall Henning, Currencies and politics in the United States, Germany, and Japan , Peterson Institute, 1994, p. 69.
- ↑ Gottfried Wohlmannstetter: Finanzplatz Tokio Knapp, Frankfurt 1991, p. 184.
- ↑ Bank of Japan: http://www.boj.or.jp/en/about/organization/policyboard/index.htm/
- ↑ Ryuzo Miyao: The Effects of Monetary Policy in Japan. In: Journal of Money, Credit and Banking. Volume 34, No. 2, May 2002, pp. 376-392, here: p. 389, JSTOR 3270693
- ↑ Gottfried Wohlmannstetter: Finanzplatz Tokio Knapp, Frankfurt 1991, pp. 186–187.
- ^ Bank of Japan: International Finance ( Memento June 23, 2006 in the Internet Archive ), accessed December 1, 2009.
Coordinates: 35 ° 41 ′ 11.6 ″ N , 139 ° 46 ′ 17.5 ″ E