On May 25, 2023, Bank of Japan Governor Kazuo Ueda arrives in Tokyo for interviews with a small group of journalists.
Richard A. Brooks | AFP | Getty Images
The Bank of Japan maintained its ultra-loose monetary policy on Friday, opting to support fragile economic growth amid mounting global uncertainty.
The Bank of Japan kept its short-term interest rate target at -0.1% and made no changes to its yield curve control policy, in line with economists’ expectations.
The Bank of Japan’s monetary policy is very different from that of most advanced economies. The BOJ has kept its short-term interest rate target at -0.1% since it first adopted negative rates in 2016.
Earlier this week, the Federal Reserve left rates unchanged on Wednesday after raising them 10 times in a row, while the European Central Bank raised its key interest rate to the highest level in 22 years on Thursday.
Friday’s decision shifted focus to the bank’s next meeting, scheduled for July.
Economists have been watching changes to the Bank of Japan’s yield curve control policy, which aims to keep the 10-year Japanese government bond yield around 0%. In December last year, the central bank unexpectedly expanded the target range of the 10-year government bond yield to 50 basis points above and below 0%.
Japan’s core inflation rate was 3.4% in April, after a sharp upward revision to 2.7% in the first quarter.
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