(MENAFN- Kuwait News Agency (KUNA)) TOKYO, April 26 (KUNA) -- Japan's central bank on Friday kept its policy rate unchanged, while downgrading its assessment of the country's economy.
At a two-day policy meeting, Bank of Japan's (BOJ) Governor Kazuo Ueda and his eight board colleagues decided to guide short-term interest rates in a range of zero to 0.1 percent, holding the policy the BOJ made in March, when it raised interest rates for the first time in 17 years, according to a statement released by the BOJ.
The central bank will also continue purchasing 10-year Japanese government bonds in line with the March decision.
Meanwhile, in its outlook report published after the meeting, the BOJ revised down growth forecast for the world's third-largest economy, saying it is expected to grow 0.8 percent in the current fiscal year that began in April, compared with the 1.2 percent growth estimated in January. "Japan's economy is likely to keep growing at a pace above its potential growth rate, with overseas economies growing moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions," the central bank said.
The BOJ raised its outlook for core inflation, which excludes volatile fresh food, for fiscal 2024 to 2.8 percent, up from its previous forecast of a 2.4 percent increase.
Inflation for both fiscal 2025 and 2026 is predicted to rise 1.9 percent, the bank added. Concerning risks to the outlook, the bank said there remain high uncertainties surrounding Japan's economic activity and prices, including developments in overseas economic activity and prices, developments in commodity prices, and domestic firms' wage- and price-setting behavior. "Under these circumstances, it is necessary to pay due attention to developments in financial and foreign exchange markets and their impact on Japan's economic activity and prices," it noted. (end)
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