like today's meeting, its website, and sns. it will continue to make efforts and seek ways to explain its thinking on the monetary policy conduct, including the content of the upcoming assessment, as clearly as possible. as for the recent paper on how central banks should enhance their communications, see candia, b., coibion, o., and gorodnichenko, y., " communication and the beliefs of economic agents, " nber working paper, no. 27800, 2020. iii. current situation of and outlook for kanagawa prefecture's economy next, i would like to talk about the economy of kanagawa prefecture. as with japan's economy as a whole, the prefecture's economy has picked up as a trend, although it has remained in a severe situation due to the impact of covid - 19. however, the pace of improvement is likely to be only moderate while vigilance against covid - 19 continues. in addition, the population of kanagawa prefecture is expected to start declining within the next few years, and the impact of the declining and aging population on the economy is likely to intensify. however, the declining and aging population will not automatically lead to an economic decline. the important thing is how to address and tackle the issue. kanagawa prefecture seems to be very active in its efforts to achieve economic growth while looking to the future. here, i would like to focus on three of the most notable examples. the first is the concentration of research and development ( r & d ) centers. while kanagawa prefecture has always had the largest number of people engaged in r & d in japan, the concentration of r & d centers has accelerated in recent years. for example, leading companies at home and abroad, as well as universities, have actively moved their r & d facilities and campuses into the keihin coastal area life innovation international strategic comprehensive special zone and the minato mirai 21 district of yokohama city, and these areas have become a major r & d center in japan. industry - academia - government research collaboration should give rise to internationally competitive leading industries, which will serve as an engine for technological innovation. the second notable example is the development of logistics centers. with its international trading ports of yokohama, kawasaki, and yokosuka, kanagawa prefecture has long been a logistics hub for japan, acting as a major window connecting the country with the rest of the world. with the further development of the expressway network that directly

the latest outlook report points to two risks, which are uncertainties over firms'price - setting behavior and developments in foreign exchange rates and international commodity prices. in particular, we pay great and utmost attention to the possible impact of developments in foreign exchange rates on prices. ii. the bank's conduct of monetary policy now, i will talk about the bank's conduct of monetary policy. covid - 19 has been significantly affecting developments in economic activity and prices as well as financial conditions. in this situation, the bank judges that the following responses are important to address the covid - 19 shock first and foremost : to provide support for corporate financing so that firms can sustain their businesses and to maintain stability in financial markets in order to prevent deterioration in the real economy, such as in employment. 4 at the same time, given that downward pressure is likely to be exerted on economic activity and prices for a prolonged period due to the impact of covid - 19, it is necessary to consider the appropriate future conduct of monetary policy. a. monetary policy responses to the impact of covid - 19 let me start with responses to be made for the time being ( chart 8 ). the bank has conducted powerful monetary easing since last spring in response to covid - 19 through the following three measures : ( 1 ) the special program to support financing in response to the novel coronavirus ( covid - 19 ) to provide support mainly for corporate financing ; ( 2 ) an ample and flexible provision of funds, mainly by purchasing japanese government bonds ( jgbs ) and conducting the u. s. dollar funds - supplying operations ; and ( 3 ) active purchases of exchange - traded funds ( etfs ) and japan real estate investment trusts ( j - reits ). the bank's responses have had positive effects ( chart 9 ). global financial markets became highly volatile last spring but have regained stability due to large - scale responses made by governments and central banks around the world, including the bank of japan. although these responses would prevent as much as possible the impairment of human capital and firms'organization capital. as for organization capital, see prescott, e. c. and visscher, m., " organization capital, " journal of political economy, vol. 88, no. 3 ( june 1980 ) : pp. 446 - 61. firms'financial positions have been weak, the environment for external funding has remained accommodative owing to the bank's and the government's