TOKYO, July 11 The Bank of Japan kept monetary
policy steady on Thursday and offered a more optimistic view of
the economy on growing signs that the positive effects of a weak
yen and the government's reflationary policies are widening.
In a quarterly review of its long-term growth estimates, the
central bank made no major changes to its forecast that core
consumer inflation will accelerate in the coming years to near 2
percent in the business year to March 2016.
As widely expected, the BOJ voted unanimously to maintain
its pledge of increasing base money, or cash and deposits at the
central bank, at an annual pace of 60 trillion to 70 trillion
yen ($600 billion-$700 billion).
"Japan's economy is starting to recover moderately," the BOJ
said in a statement, revising up its assessment for a seventh
straight month. Last month, it said the economy was "picking
BOJ board member Takahide Kiuchi proposed that the central
bank make its 2 percent inflation target a medium- to long-term
goal, and commit to intensive easing in the next two years. This
would differ from the BOJ's current commitment to hit its
inflation target in roughly two years.
Kiuchi's proposal was rejected in an 8-1 vote.
BOJ Governor Haruhiko Kuroda will hold an embargoed news
conference from 3:30 p.m. (0630 GMT) with his comments expected
to come out any time after 4:15 p.m. (0715 GMT).
The BOJ stunned markets by offering an intense burst of
monetary stimulus in April, pledging to double the supply of
money in two years by boosting purchases of government bonds and
In doing so, it switched its policy target from the
overnight call rate to base money, a broad measurement of the
amount of money the central bank pumps into the economy.
The BOJ issues its long-term economic and price forecasts in
April and October of each year, and reviews them in January and
July based on latest developments in the economy.