Bank of Japan resists more QE but says it still supports easing
THE BANK of Japan maintained its ultra-loose monetary policy yesterday, yet did not signal a move towards even greater stimulus.
After its policy meeting it decided to keep interest rates between zero and 0.1 per cent, with the size of its asset-buying programme also unchanged.
“There remains a high degree of uncertainty about the European debt crisis, the recovery of the US economy and the likelihood of emerging economies achieving price stability and growth,” the Bank warned.
The central bank is worried that the problems of Greece and Europe could affect Japan’s economy by hurting its exports to the region.
“The Bank of Japan has not leaned towards neutral stance at all; if there’s any doubt about our stance on strong monetary easing, I’d like to stress it has not changed at all,” said Bank of Japan governor Masaaki Shirakawain, to show that it is ready to act if need be.
The Bank is expected to resort to more easing through boosting its asset-buying programme in July when it issues its revised quarterly economic and price forecasts.