BOJ Maintains Interest Rate, Revises Growth Outlook Amid Global Uncertainty

The Bank of Japan (BOJ) maintained its main interest rate at 1%, as expected by markets, despite increasing it to a 31-year high in June. This decision came amidst pressure from officials to tighten monetary policy due to creeping inflation and the yen's four-decade low against the dollar.

According to the BOJ, Japan's economy is expected to continue growing moderately, albeit at a decelerated rate, with an estimated 0.6% expansion this year. The bank also revised its inflation outlook for the current fiscal year to 2.5%, down from 2.8% previously anticipated.

The BOJ acknowledged that the Middle East crisis would weigh on energy costs and impact growth, but noted that factors such as government measures and accommodative financial conditions would support the economy.