While the Bank of Japan (BoJ) did not change the interest rates and monetary policy with the decision taken at the monetary policy meeting, it lowered its inflation and growth expectations for the 2021 fiscal year.
The decisions taken at the BoJ's monetary policy meeting, which started yesterday and ended today, were announced.
Accordingly, the bank kept the policy rate unchanged at minus 0.1 percent. The BoJ, which passed the resolution by 8 votes to 1, announced that it will continue to purchase unlimited amounts of government bonds and 12 trillion yen annually in exchange-traded funds (ETFs) and 180 billion yen annual Japanese real estate investment funds (J-REIT).
In the text of the decision of the bank, it was emphasized that the Return Curve Controlled Monetary Expansion policy will continue until the 2 percent inflation target is reached, and "We will continue to expand the monetary base until the annual inflation exceeds the 2 percent target and remains above the target." it was said.
Emphasizing that the BOJ will continue to mainly support the financing of companies and maintain its financial stability, the text said, "For now, the bank will closely monitor the impact of the coronavirus outbreak and will not hesitate to take additional expansionary measures if necessary. In addition, interest rates will remain at the current or lower levels in the short and long term. expected." message is preserved.
GROWTH AND INFLATION EXPECTATIONS
The bank lowered its inflation midpoint forecast for the 2021 fiscal year, which will end in March 2022, from 0.6 percent to 0 percent. It also reduced its real Gross Domestic Product (GNI) forecast for the same period from 3.8 percent to 3.4 percent.
While keeping its inflation expectation for the 2022 fiscal year, which will end in March 2023, at 0.9 percent, it revised its growth forecast from 2.7 percent to 2.9 percent.
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