MNI BRIEF: BOJ On Hold; Keeps 1% 10-Yr JGB Yld As Reference

The Bank of Japan board on Tuesday decided to keep its yield curve control and negative interest rate policy as a virtuous cycle between wages and prices has not strengthened sufficiently to achieve the bank’s 2% target.

The BOJ kept the short-term interest target at -0.1%, the long-term interest rate target at around zero percent, and the upper end of for 10-year Japanese Government Bond yields at 1% as a reference.

The bank also maintained the forward guidance for the policy rates, saying it will continue to maintain the stability of financing, mainly of firms, and financial markets, and will not hesitate to take additional easing measures if necessary.

“The BOJ will patiently continue with monetary easing while nimbly responding to developments in economic activity and prices as well as financial conditions,” the BOJ said in a statement. “By doing so, it will aim to achieve the price stability target of 2% in a sustainable and stable manner, accompanied by wage increases.”