BOJ Keeps Call Rate Steady Amid Economic Growth Forecast
The Bank of Japan's (BOJ) Policy Board made a decision to set a guideline for money market operations at its latest meeting. By an 8-1 majority vote, the BOJ decided that the uncollateralized overnight call rate should remain around 1.0 percent during the intermeeting period.
The BOJ believes Japan's economy will continue growing moderately in fiscal 2026 despite a decelerated rate due to rising crude oil prices. However, factors such as government measures and accommodative financial conditions are expected to support economic activity.
Looking ahead, the BOJ predicts that Japan's economic growth rate will rise moderately from fiscal 2027 onward as the adverse effects of high crude oil prices wane and a virtuous cycle from income to spending intensifies. The central bank also emphasized its need to monitor the impact of global AI demand on the economy and future currency trends.