The Bank of Japan (BoJ) decided to maintain its monetary policy today, based on ultra low interest rates and a large asset purchase program, at a time marked by persistent low inflation and global uncertainty.
At the end of Thursday's two-day monthly meeting, the monetary policy board of the Japanese central bank decided by majority (7-2) to maintain short-term interest rates at -0.1% and its large purchase program of state bonds to maintain their performance around 0% in the long term.
The entity will continue with the acquisition of bonds worth about 80 billion yen per year (625,087 million euros / 711,335 million dollars), although it will adjust the pace of purchase "flexibly" according to market conditions, he said in a statement. release.
The BoJ aims to put inflation at 2% year-on-year, but has been forced to postpone this goal indefinitely and activate additional stimulus measures due to the fall in oil prices, the global slowdown and the weakness of domestic consumption.
The entity considers that the Japanese economy "will continue its moderate expansion" and believes that the national demand "will follow an upward trend".
The Japanese central bank also mentioned in its report the risks faced by the world's third largest economy, among which he cited "the macroeconomic policies of the United States and their impact on global financial markets, the consequences of protectionism and negotiations" on the brexit .
The entity also referred to the VAT increase from 8% to 10% from October 1, 2019, which, although necessary to cover the rising costs of Japan's social security, could affect private consumption in the Asian country, as it happened with the rise rushed in April 2014.
The Japanese government is preparing stimulus measures to avoid such a scenario, while the BoJ reaffirmed today its commitment to maintain its measures of ultra-flexibility "a prolonged period of time", while taking into account the "uncertainty in economic activity and prices" linked upward of the assessment.
The decision of the BoJ to maintain its monetary policy unchanged keeps it on a divergent path with respect to other major central banks that are reversing the measures that were put in place in the wake of the 2008 financial crisis, including the Central Bank European or the US Federal Reserve.