Bank of Japan keeps base rate unchanged

VTV.vn - The Bank of Japan (BoJ) on October 30 decided to keep the base interest rate at 0.5% after a two-day policy meeting.

Headquarters of the Bank of Japan in Tokyo. (Photo: Kyodo/VNA)

This is the first meeting of the BoJ since new Prime Minister Sanae Takaichi, known to favor easy monetary policy, officially took office last week.

The BoJ kept the rate unchanged for the sixth consecutive meeting as expected by the market, as it continued to monitor the impact of the US's sharp increase in import tariffs. The BoJ raised its base rate to the current level in January 2025, marking a significant shift after years of maintaining ultra-loose policy.

The decision was passed by a 7-2 vote, similar to last month's meeting, according to the announcement. Two hawkish members proposed raising interest rates to around 0.75%, citing persistent inflation. The BoJ stressed that it would continue to raise interest rates if economic activity and prices develop in line with its outlook. Currently, Japan's core consumer price index (CPI) has remained at or above 2% for more than three consecutive years, exceeding the bank's inflation target.

In its latest quarterly economic outlook report, the BoJ forecast Japan's economy to grow 0.7% in the fiscal year ending March 2026, up from the 0.6% forecast in July, reflecting confidence that domestic demand and business investment remain solid.

Immediately after the BoJ's announcement, the Japanese yen fell by about 1 yen to 153 yen per dollar, as investors believed that the loose monetary policy would be maintained for a longer time. In the Japanese stock market, the Nikkei 225 index initially rose more than 300 points to a record high during the session, but then lost momentum and turned down.

Analysts said that the BoJ's decision to keep interest rates unchanged shows the government 's cautious approach to monetary policy in the early stages, while also allowing the bank more time to assess the impact of prolonged inflation and global economic fluctuations before making any adjustments in the near future.

Source: https://vtv.vn/ngan-hang-trung-uong-nhat-ban-giu-nguyen-lai-suat-co-ban-100251030142422035.htm