The Bank of Japan kept monetary policy steady on Thursday despite growing signs of strength in the economy, signalling that it was in no rush to edge away from crisis-mode stimulus with inflation still distant from its 2.0 per cent target.
In a widely expected move, the BOJ maintained the 0.1 per cent interest it charges on a portion of excess reserves that financial institutions park at the central bank.
At the two-day policy meeting that ended on Thursday, it also maintained its yield target for 10-year Japanese government bonds around zero per cent.
“Japan’s economy is expanding moderately,” the BOJ said in a statement announcing the policy decision.
The decision on maintaining interest rate targets was made by an 8-1 vote.
Board member Goushi Kataoka dissented to the decision, arguing that the likelihood of inflation accelerating towards 2 per cent was low.
BOJ Governor Haruhiko Kuroda will hold a news conference at 3:30 p.m. (0630 GMT) to explain the policy decision.