The Bank of Japan decided to maintain its monetary policy and assess the impact of the July interest rate hike and market trends.
The decision was unanimous, with all economists surveyed predicting a policy stance.
The assessment of the current state of the economy and the outlook, as well as the view on the underlying prices, remains unchanged.
The Bank of Japan decided to maintain the policy interest rate and unsecured call overnight rate at around 0.25% at the monetary policy decision-making meeting on the 20th, against the background of the need to assess the impact of the additional rate hike in July and the destabilization of financial market trends in August.
The statement stated that while there are some signs of weakness in the economy, it is gradually recovering, and the outlook maintains the perception of continuing growth exceeding the potential growth rate. The core consumer price index is expected to move at a level broadly consistent with price stability in the latter half of the outlook period for 2024-2026 as indicated in the economic and price situation outlook report.
In a survey conducted by Bloomberg from the 6th to the 11th targeting 53 economists, all expected the current monetary policy to be maintained. Despite the significant destabilization of financial markets due to concerns about a slowdown in the US economy following the rate hike decision at the July meeting, there has been no significant change in the BOJ's economic and price outlook or policy stance based on the statement released at this meeting.
Following the meeting results, the foreign exchange market saw the yen trading against the dollar in a volatile manner, with movements hovering around 142 yen per dollar.
The assessment of the current state of the economy and the outlook, as well as the view on the underlying prices, remains unchanged.
The Bank of Japan decided to maintain the policy interest rate and unsecured call overnight rate at around 0.25% at the monetary policy decision-making meeting on the 20th, against the background of the need to assess the impact of the additional rate hike in July and the destabilization of financial market trends in August.
The statement stated that while there are some signs of weakness in the economy, it is gradually recovering, and the outlook maintains the perception of continuing growth exceeding the potential growth rate. The core consumer price index is expected to move at a level broadly consistent with price stability in the latter half of the outlook period for 2024-2026 as indicated in the economic and price situation outlook report.
In a survey conducted by Bloomberg from the 6th to the 11th targeting 53 economists, all expected the current monetary policy to be maintained. Despite the significant destabilization of financial markets due to concerns about a slowdown in the US economy following the rate hike decision at the July meeting, there has been no significant change in the BOJ's economic and price outlook or policy stance based on the statement released at this meeting.
Following the meeting results, the foreign exchange market saw the yen trading against the dollar in a volatile manner, with movements hovering around 142 yen per dollar.
The national consumer price index excluding fresh food (core CPI) announced by the Ministry of Internal Affairs and Communications for August, on the 20th, showed a 2.8% year-on-year increase, expanding the positive margin for the fourth consecutive month. The rise was driven by energy prices remaining high, as well as increases in food and durable goods for households. The core core CPI, excluding fresh food and energy, rose by 2.0%, recovering the 2% range for the first time in two months.
Following the market turbulence at the beginning of August, Deputy Governor Shinichi Uchida announced on August 7th that no rate hikes would occur in the current unstable market conditions. Subsequently, Governor Haruhiko Kuroda and other policy board members expressed their unchanged stance of closely monitoring the market with high vigilance, while indicating that they would proceed with rate hikes if the economic and price developments align with the BOJ's outlook.
Following the market turbulence at the beginning of August, Deputy Governor Shinichi Uchida announced on August 7th that no rate hikes would occur in the current unstable market conditions. Subsequently, Governor Haruhiko Kuroda and other policy board members expressed their unchanged stance of closely monitoring the market with high vigilance, while indicating that they would proceed with rate hikes if the economic and price developments align with the BOJ's outlook.
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