Boj Keeps Rates Unchanged In September

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Boj Keeps Rates Unchanged In September

Bank Of Japan Keeps Rates Unchanged In September

The Bank of Japan (BoJ) has decided not to change the rates on Friday. This decision was in line with the expectations and thus was not a surprise at all.

The Bank of Japan (BoJ) has mentioned that the Japanese economy will enjoy outsized growth. They also commented on how the inflation is steadily rising. Based on these comments, it seems that BoJ has left the possibility of more rate hikes open.

Short-Term Rate In Japan Steady At 0.25%

After the announcement, the short-term rate in Japan remains steady at 0.25%. All the 9 members of the BoJ decided to hold the rates for now.

It seems that the Japanese bank (BoJ) has decided to adopt the wait-and-see approach. This is the same approach used by the BoE, ECB, and the Fed.

After all, BoJ has already raised the rates two times this year and now wants to see its full effect on the economy before moving forward.

As for what's ahead, the BoJ decided not to give any clues for now. Now, the Governor's press conference will likely offer more insights on the matter.

The central bank commented on how the growth rate of Japan is above forecast while the inflation will also rise further in the coming months.

The BoJ's decision was announced after the CPI data showed a 10-month high reading. Also, the private consumption in Japan has increased.

Higher inflation will be a key reason for the Bank of Japan to raise the rates. With a higher reading and expectations of further increase, it makes sense to expect more rate hikes in 2024.

However, there is still a higher degree of uncertainty surrounding Japan's economy. The volatility in the FX market will likely affect local prices especially.

While the BoJ has decided not to take action, it has maintained a hawkish stance. On the other hand, the Fed has started its easing cycle which will also continue in 2025.

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