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Bank of Japan holds steady on policy, negative rates

Published 03/14/2016, 11:53 PM
Updated 03/14/2016, 11:55 PM
© Reuters.  BoJ hold steady on policy

Investing.com - The Bank of Japan on Tuesday held monetary policy steady in an 8 to 1 vote and negative rates intact in a 7 to 2 vote.

The BoJ however downgraded its estimates of inflation to a weaker outlook for price growth.

The BoJ has an annual target of ¥80 trillion in asset purchased and a 0.1% negative interest rate on deposits.

"Although inflation expectations appear to be rising on the whole from a somewhat longer-term perspective, they have recently weakened," the BoJ said. In January it said "some indicators have recently shown relatively weak developments."

"The year-on-year rate of increase in the CPI is likely to be about zero percent for the time being," the BoJ repeated.

Two of the four members who voted against adopting the negative interest rate policy at the bank's last meeting in January continued opposing the new tool of monetary easing. They said the BoJ should apply positive 0.1% interest to current account balances excluding the amount outstanding of the required reserves held by financial institutions at the central bank.

Among technical measures for smoothly implementing easing, the board decided to review the scale of current deposits to which the negative 0.1% interest is applied every three months.

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