Tokyo: Japan’s central bank decided on Thursday to keep its ultra-loose monetary policy to overcome deflation and prop up the nation’s economy despite signs of a slowing economy after a consumption tax hike.
The central bank decided to maintain the short-term interest rate at minus 0.1 per cent and the long-term interest rates at around zero per cent, it said after a two-day monetary policy meeting.
The bank will also continue large-scale asset purchases, it said in a statement. Aggressive monetary easing measures were introduced in April 2013 as the bank aimed to reach its 2 per cent inflation target within two years.
Consumer prices rose 0.4 per cent year-on-year in October and the reading was still far off the bank’s target.
Thursday’s decision comes after the bank’s quarterly survey showed last week that confidence among large Japanese manufacturers deteriorated for the fourth consecutive month to the worst level in six and a half years amid concerns about international trade disputes and a consumption tax increase.
The government raised the nation’s consumption tax from 8 per cent to 10 per cent on October 1 despite sluggish consumer spending. — dpa
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