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Bank of Japan keeps interest rates unchanged

Bank of Japan keeps interest rates unchanged

By Swedan Margen

Fashion

The Bank of Japan kept interest rates on hold Thursday at 0.5 per cent, as widely expected by economists.

The announcement came after the first monetary policy meeting since Sanae Takaichi became Japan’s new premier.

Takaichi is widely seen as in favour of monetary easing and active fiscal spending to boost the economy.

“High uncertainties still remain regarding the impact of trade and other policies on economic activity and prices at home and abroad,” the BoJ said in a statement following the decision.

The announcement also came after US Treasury Secretary Scott Bessent told his Japanese counterpart about the importance of “anchoring inflation expectations”.

Bessent visited Tokyo along with US President Donald Trump who was meeting Takaichi face-to-face for the first time.

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On Thursday, the Nikkei added as much as 0.4 per cent to reach 51,513.66 for the first time, before last trading at 51,417.50.
While data so far has shown Japan's economy weathering the hit from US tariffs, BOJ Governor Kazuo Ueda has warned that the impact could intensify in coming months.

“The message was clear - Japan’s balance sheet can no longer afford the distortions of ultra-low rates, and the global system can no longer run on the assumption that the yen will always absorb excess liquidity,” said Stephen Innes, managing partner of SPI Asset Management. AFP

Originally published by businesstimes.com.sg. Syndicated material does not necessarily reflect the views of Grazia British.

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