BOJ decides to review monetary policy

The Bank of Japan left monetary policy unchanged at its two-day meeting as expected and decided to review monetary policy. The Bank of Japan (BOJ) left monetary policy unchanged on Friday but renewed its guidance on its future policy path and decided to conduct a “broad perspective” review of monetary policy. In a statement made after the meeting, it was emphasized that a period of 1-1.5 years will be spent on the review. The BOJ left its short-term interest rate target at 0.1 percent and its target for the 10-year bond yield at around 0 percent as expected at its two-day meeting that ended Friday. However, it changed its forward-looking guidance by removing references to the need to protect against risks arising from the COVID-19 outbreak and keep interest rates “at current or lower levels.” Growth expectations raised The Bank of Japan (BOJ) raised its growth expectations while downgrading its expectations for core inflation, which it closely follows. According to the statement made by the BOJ, the core consumer price expectation for the 2023 fiscal year was lowered from 1.6 percent to 1.4 percent, and for the 2024 fiscal year it was lowered from 1.8 percent to 1.2 percent. The bank announced its expectation for the 2025 fiscal year as 1.0 percent.