BOJ Keeps Rates Steady, Signals Hawkish Resolve Amid Yen Intervention

The Bank of Japan (BOJ) kept interest rates steady at 1% on July 31, but signaled its resolve to continue pushing up borrowing costs. This decision came after the government's yen-buying intervention overnight failed to give the sagging currency lasting support.

Japan conducted yen-buying and dollar-selling market intervention in New York markets on Thursday, although the yen's rebound proved short-lived. US Treasury Secretary Scott Bessent said Japan may have intervened to prop up its yen currency that looked 'very undervalued', according to a Fox Business Network reporter.

The BOJ kept short-term interest rates steady at 1% in a widely expected move after a hike to the 31-year-high level just last month. Board member Hajime Takata was the sole dissenter to the decision, calling for a rate hike to 1.25% to respond to inflationary risks from external demand shocks.