Bank of Japan announces their main policy planks remain in place untouched, as expected.

USD/JPY has jumped sharply higher.

  • Maintains short-term interest rate target at -0.1%
  • Maintains 10-year JGB yield target around 0%, with 1% upper reference rate kept unchanged
  • YCC decision unanimous
  • BOJ makes no change to forward guidance


  • Economy has recovered moderately
  • Private consumption continues to rise moderately
  • Y/y rate of rise in CPI slower than a while ago mainly due to effects of pushing down energy prices
  • But CPI has been around 3% recently due to pass-through of cost increases to consumer prices
  • Inflation expectations have risen moderately
  • Economy likely to continue recovering moderately for time being
  • Japan economy projected to continue growing at pace above potential growth rate
  • Rate of rise in CPI likely to be above 2% through fiscal 2024
  • Thereafter, rate of rise projected to slow down
  • Underlying CPI inflation likely to increase gradually toward achieving price stability target
  • Japan's economy likely to continue recovering moderately
  • Inflation expectations heightening moderately
  • Trend inflation likely to gradually accelerate
  • Inflation likely to move above 2% then slow pace of increase thereafter
  • Uncertainty regarding Japan's economy, prices remain very high
  • Must scrutinise FX, market moves and their impact on economy, prices


There was never any real prospect of much change from the Bank at this meeting. Ueda, and other officials, had been watering down expectations ever since his 'tough times at end of 2023' comments were misinterpreted, sending yen rocketing:

Having said this, it was 12 months ago, at the December 2022 meeting, that then-Governor Kuroda dropped the bombshell that the yield on 10-year JGBs would be allowed to rise after promising for weeks leading up to the meeting that he would allow no such thing. So, its hard to blame the market for speculating on change from the BoJ given the hit to credibility it took then.


Full text here

Still to come is Governor Ueda briefing the media on the decision 0630 GMT

BoJ Governor Ueda