Bank of Japan to keep current policies in place

Global Business

Bank of Japan to keep current policies in place

The outcome of the Bank of Japan’s first policy meeting of the year was somewhat composed of optimism and caution.

CGTN’s Terrence Terashima reports.

Bank of Japan to keep current policies in place

Bank of Japan to keep current policies in place

The outcome of the Bank of Japan’s first policy meeting of the year was somewhat composed of optimism and caution. CGTN’s Terrence Terashima reports.

The Japanese central bank kept its policy unchanged. It will continue to guide the short-term interest rates at minus 0.1 percent and the 10-year government bond yield to around zero percent. At the same time, it will also maintain the current pace of buying government bonds at ¥80 trillion, about $705 billion a year.

The policymakers were somewhat bullish on the economy, forecasting stronger growth, and raising its economic growth forecast in fiscal 2017 to 1.5 percent, from 1.3 percent, which is on a back of improvements in economic indicators and improvements in overseas economies.

The BOJ board forecasted inflation for the next fiscal year at 1.5 percent. However, Kuroda, Bank of Japan Governor, sighted number of downside risks, such as developments in the emerging economies, consequences stemming from Brexit and uncertainty over developments in the U.S. economy and impact of its monetary policy in global financial markets.

Experts argued that the BOJ will likely maintain its stance until the direction of U.S. monetary policy is clearer.

Kuroda said BOJ will be vigilant on the upside and downside risks and will implement appropriate measures.