At today’s meeting, policymakers at the Bank of Japan (BoJ) kept the policy unchanged, and the benchmark interest rate at -0.1 percent.

Let’s look at the current monetary policies,

• Bank of Japan had already shifted the timeline for reaching the 2 percent inflation goal to “earliest possible time” and with that view, it had introduced QQE with yield curve control. It means that the bank would guide both short term and long term rates while purchasing assets at the pace of ¥80 trillion per annum until the inflation overshoots the 2 percent target and stays above.
• For short-term rate controls, BoJ will maintain a negative interest rate of -0.1 percent and for the long-term rate control, it would purchase assets in such a manner that the 10-year yield remains around zero percent.
• In addition to that, BoJ would use fixed rate purchases of JGBs and fixed rate funds supplying for a period up to 10 years.
• The bank will continue to purchase ETFs at ¥6 trillion per annum, CPs at ¥2.2 trillion annually, corporate bonds at ¥3.2 trillion annually, and J-REITs at ¥90 billion per annum.

Key takeaways from the economic outlook -

• Japan’s and overseas economies are expanding at a moderate pace. Exports have been on an increasing trend. Business fixed invests are expanding at a moderate pace and corporate profits improved. Private consumption increased resilience against a background of steady improvement in employment and income. Housing and public investments are flat. Industrial production is in an increasing trend. Financial conditions remain accommodative. CPI inflation has been zero for the year with inflation expectations in a weakening phase. (Mild hawkish bias)
• Inflation is likely to continue its uptrend and increase towards 2 percent on the back of improvement in the output gap and a rise in medium to long-term expectations. (Neutral bias)
• Risks include the impacts of U.S. economic policies, Brexit, developments in emerging and commodity-exporting countries, European debt problem, and geopolitical risks. (Dovish bias)
• BoJ says that it would continue with its monetary policy unless inflation reaches 2 percent objective. The bank would do adjustments as necessary. (Neutral bias)

The Bank of Japan’s (BoJ) monetary policy statement remains broadly balanced as of now. The yen is currently trading at 111.2, down 0.16 percent for the day so far.