Tokyo, July 16, (dpa-AFX/GNA) – The Bank of Japan decided to keep its monetary stimulus unchanged and unveiled a preliminary outline for a new programme to support efforts on climate change.
The bank also lowered its near-term growth outlook citing the impact of the coronavirus pandemic and raised its fiscal 2021 inflation forecast.
The board, governed by Haruhiko Kuroda, on Friday, voted 8 to 1, to hold the interest rate at minus 0.1 per cent on current accounts that financial institutions maintain at the central bank.
The bank will continue to purchase a necessary amount of Japanese government bonds without setting an upper limit so that 10-year JGB yields will remain at around zero percent.
The BoJ also provided a preliminary outline for a new-funding programme to support efforts in fields related to climate change. The bank plans to launch the measure this year and to continue until March 2031.
The bank downgraded its near-term growth projections.
The economy is forecast to expand 3.8 per cent in the fiscal 2021 instead of 4 per cent estimated in April.
However, the outlook for the fiscal 2022 was lifted to 2.7 per cent from 2.4 percent and the estimate for the fiscal 2023 was retained at 1.3 per cent.
Citing higher energy prices, the bank expects inflation to rise to 0.6 per cent in the fiscal 2021 instead of 0.1 per cent projected previously. Inflation forecast for the next fiscal was lifted marginally to 0.9 per cent from 0.8 per cent and the outlook for the fiscal 2023 was maintained at 1 per cent.
GNA