The Bank of Japan maintains its interest rate unchanged with an 8-1 vote, will consider raising rates as circumstances warrant

Odaily News The Bank of Japan kept its policy rate at 1% on Friday, in line with expectations. Last month, the central bank raised its benchmark rate to the highest level since 1995. Board member Takata Hajime dissented, supporting a 25-basis-point rate hike. Takata argued that the situation has entered a new phase, and the Bank of Japan needs to adopt a flexible approach to address upside risks to prices and changes in overseas financial conditions. The Bank of Japan stated that it will continue to raise interest rates based on economic and price developments as well as financial conditions. Underlying inflation is close to 2%, and financial conditions remain accommodative. Both significant downside risks to economic activity and significant upside risks to prices have diminished. In its latest economic projections, the Bank of Japan revised down its core CPI forecast for fiscal 2026 from 2.8% to 2.5%, while revising up its GDP growth forecast for fiscal 2026 from 0.5% to 0.6%. (Jin Shi)