BoJ left monetary policy unchanged as widely expected, by 8-1 vote, with dove Goushi Kataoka dissented again. Under the yield curve control framework, short-term policy interest rate is held at -0.10%. 10-year JGB yield target is kept at around 0%, without upper limit on JGB purchases. BoJ also clarified that it will offer to purchase 10-year JGBs at 0.25% every business day through fixed-rate purchase operations.
The central bank also reiterated that it will “expanding the monetary base until the year-on-year rate of increase in the observed consumer price index (CPI, all items less fresh food) exceeds 2 percent and stays above the target in a stable manner.”
It also pledged that it “will not hesitate to take additional easing measures if necessary; it also expects short- and long-term policy interest rates to remain at their present or lower levels.”
In the new economic projections, GDP is forecast to grow:
- 2.9% in fiscal 2022 (revised down from 3.8%)
- 1.9% in fiscal 2023 (revised up from 1.1%)
- 1.1% in fiscal 2024 (new).
CPI (all items less fresh food) is expected to be at:
- 1.9% in fiscal 2022 (revised up from 1.1%).
- 1.1% in fiscal 2023 (unchanged).
- 1.1% in fiscal 2024 (new).
