Bank of Japan leaves monetary easing scheme unchanged

TOKYO, Japan – The Bank of Japan (BoJ) on Thursday, August 8 left its vast monetary easing program unchanged, as it issued an upbeat assessment of Tokyo’s efforts to counter growth-sapping deflation.

In a widely expected move, the central bank said its board voted unanimously to stand pat after wrapping up a two-day policy meeting, as investors keep a close eye on the US Federal Reserve amid growing speculation it would soon start tapering its huge stimulus program.

The BoJ, which unveiled its own gigantic bond-buying scheme in April, said the outlook for the world’s third-biggest economy was looking brighter, while early signs of rising prices were good news for its efforts to hit a 2% inflation target in as many years.

Many analysts have heaped doubt on the BoJ’s ambitious timeline given that Japan has been struggling with deflation for more than 15 years. The inflation target is a key part of an economy-boosting plan launched by Prime Minister Shinzo Abe, dubbed “Abenomics”.

“Japan’s economy is starting to recover moderately,” the BoJ said Thursday, pointing to better times ahead for key export markets.

“Overseas economies as a whole are gradually heading toward a pick-up, although a lacklustre performance is partly seen… Inflation expectations appear to be rising as a whole.” – Rappler.com