Bank of Japan Monetary Policy Decision - 24 January 2024

Global outlier holds firm, yet eyes a hawkish turn

No clear hint on the timing of a long-awaited policy shift. As widely expected, the Bank of Japan (BoJ) maintained its monetary policy settings. However, it emphasised that the certainty of reaching its price target was gradually increasing.

Unanimous vote on Yield Curve Control (YCC):

  • The short-term policy interest rate: maintained its negative interest rate policy (NIRP) at -0.1% to the Policy-Rate Balances in current accounts held by financial institutions at the bank.
  • The long-term interest rate: to purchase a necessary amount of Japanese government bonds (JGBs) without setting an upper limit to keep the 10-year JGB yields at around 0.0%.
    • To implement the above guideline for market operations, the BoJ will consider 1.0% as the upper bound reference for 10-year JGB yields.