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(CEP News) The Bank of Japan cut their target rate by 20 basis points to 0.10% on Friday, against the consensus forecast for no change but in-line what some market-watchers were expecting.
The monetary policy statement said the decision was made 7-1. The Bank has also decided to increase purchases of Japanese government bonds, including inflation-linked bonds, floating-rate bonds, and 30-year bonds. The Bank announced measures to buy commercial paper as well, and said it will consider buying other corporate debt products. All of these measures were expected from the BOJ, which was under tremendous pressure to act to buoy Japan's ailing economy, especially after the Federal Reserve cut its own interest rate to a 0.0%-0.25% range earlier this week. In their assessment of the economy, the Bank of Japan said the economy is worsening, and will likely become worse in the short term. The monetary policy statement from the Bank said it is unsure whether the Japanese economy will return to a sustainable growth path. By Megan Ainscow,
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