BOJ keeps policy steady, remains upbeat on economy

TOKYO (Reuters) – The Bank of Japan kept monetary policy steady on Thursday despite growing signs of strength in the economy, signaling that it was in no rush to edge away from crisis-mode stimulus with inflation still distant from its 2 percent target.

In a widely expected move, the BOJ maintained the 0.1 percent interest it charges on a portion of excess reserves that financial institutions park at the central bank.

At the two-day policy meeting that ended on Thursday, it also maintained its yield target for 10-year Japanese government bonds around zero percent.

“Japan’s economy is expanding moderately,” the BOJ said in a statement announcing the policy decision.

The decision on maintaining interest rate targets was made by an 8-1 vote.

Board member Goushi Kataoka dissented to the decision, arguing that the likelihood of inflation accelerating towards 2 percent was low.

BOJ Governor Haruhiko Kuroda will hold a news conference at 3:30 p.m. (0630 GMT) to explain the policy decision.

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