The Bank of Japan (BOJ) said that it will keep its accommodative monetary policy as it upgrades its inflation outlook for the country, which has been battling deflation for decades.
Japan’s central bank on Tuesday revised its inflation projection from 0.9 percent to 1.1 percent for the fiscal year starting in April and said that price risks that are currently “skewed to the downside” will be “generally balanced” soon.
The BOJ said it will stick to its policy stance, keeping its negative interest rate, asset purchases, and other stimulus programs to reach its inflation target of 2 percent. Interest rates will be left unchanged at a -0.1 percent target for short-term and around 0 percent for long-term.
BOJ Governor Haruhiko Kuroda had refuted speculations of the central bank phasing out its stimulus to pivot to a hawkish stance.
“We’re expecting long- and short-term policy rates to remain at the current low levels, or fall even lower,” Kuroda said at a press briefing on Tuesday after the decision came out. “Raising rates is unthinkable.”
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