BoJ left monetary policy unchanged today. Under the yield curve control framework, short term policy interest rate is held at -0.10%. 10-year JGB yield target is kept at around 0%, without upper limit on bond purchases. The decision was made by 8-1 vote, with Goushi Kataoka dissenting as usual, pushing for strengthening easing. It also pledged to closely monitor the pandemic impact and “will not hesitate to take additional easing measures if necessary”.
Overall assessment on the economy was maintained as its has “picked up as a trend” but “remained in a severe situation” due to the pandemic home and abroad. But it noted that some exports and production have been “affected by supply-side constraints”. Weakness has been seen in some industries on business fixed investment. Employment and income “remained weak” while private consumption remained “stagnant”. Core CPI has been at around 0% and inflation expectations have been “more or less unchanged”.
