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BOJ keeps monetary policy steady

03-14-2012 14:11 BJT

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Japan's central bank has decided to hold its current near-zero key policy rate after a surprise easing last month. Meanwhile, it’s expanding a separate loan scheme targeted at strengthening economic growth, by two trillion yen, or about 24 billion U.S. dollars.

After an unanimous vote, the Policy Board of the Bank of Japan announced it would keep the key policy rate at around zero to one-tenth of a percent. The central bank cites positive signals from international economies such as the U.S. and Europe, while some improvement in the domestic economy, including a moderate increase in domestic demand. It also notes the global financial markets have regained some stability.

But the central bank also warns, the Japanese economy is facing the long-term structural challenge of slowing growth amid a rapidly aging population. To that end, it announced it would expand a loan scheme to encourage banks to fund prospective growth industries - and encourage long-term economic growth.

Meanwhile, the central bank says it will aim for one percent inflation this year, through continuing to conduct monetary easing, conducting its virtually zero interest policy and implementing the Asset Purchase Program.

In its statement, the BOJ predicts Asia’s second-largest economy will gradually emerge from the current phase of flat growth and return to a moderate recovery path. It’s predicting the pace of recovery in overseas economies will pick up, and the year-on-year rate of change in Japan’s CPI will remain around zero percent for the time being.

Japanese Finance Minister Jun Azumi says he welcomes the central bank’s decision to hold off additional monetary policy easing and to expand the loan scheme.

 

 

Editor:Zhang Rui |Source: CNTV.CN

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