BoJ kept monetary policy unchanged today as widely expected. Under the yield curve control framework, short-term policy interest rate is held at -0.1%. 10-year yield target is maintained at around 0%, with JGB purchases without upper limit. It also reiterated that BoJ will continue with QQE with YCC “as long as it is necessary” for maintaining inflation at 2% target in a stable manner. It will also continue expanding the monetary base core CPI exceeds 2% and stays above in a stable manner.
Economic projections comparing to July forecast:
- Fiscal 2021 GDP growth downgraded from 3.8% to 3.4%.
- Fiscal 2022 GDP growth upgraded from 2.7% to 2.9%.
- Fiscal 2023 GDP growth unchanged at 1.3%.
- Fiscal 2021 CPI core downgraded from 0.6% to 0.0%.
- Fiscal 2022 CPI core unchanged at 0.9%.
- Fiscal 2023 CPI core unchanged at 1.0%.
