On March 20, 2023, in Tokyo with cherry blossoms in full bloom, you can see the headquarters of the Bank of Japan (BOJ).
Kazuhiro Nogi | AFP | Getty Images
The Bank of Japan kept its benchmark interest rate unchanged at 0.25% on Thursday.
The decision came one day after the Federal Reserve cut interest rates by 25 basis points, bringing the federal funds rate to 4.25%-4.5%.
this JPY It fell 0.16% against the US dollar after the rate decision, trading at 155.06.
The Bank of Japan said in a statement that it made the decision to keep interest rates unchanged by an 8-1 split, with board member Naoki Tamura advocating a 25 basis point increase in interest rates.
However, the central bank did note that “there remains a high degree of uncertainty about Japan’s economic activity and prices.”
Therefore, it considers it necessary to pay “due attention” to developments in financial and foreign exchange markets and their impact on Japan’s economic activity and prices.
“In particular, as corporate behavior has recently shifted more towards higher wages and prices, exchange rate changes are more likely to affect prices than in the past,” the bank added.
The BOJ’s decision is in line with a CNBC poll that showed 13 out of 24 economists expected the BOJ to keep its key interest rate unchanged in December before raising rates at its next meeting in January. .
The survey was conducted between Dec. 9 and 13, when the Fed signaled fewer rate cuts in 2025.
Citigroup’s report on December 13 predicted that the Bank of Japan will raise interest rates three times in 2025, bringing interest rates to 1%.
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