Hawkish hold as two dissenters keep October hike in play as inflation stays firm
As expected, the Bank of Japan (BoJ) left its short-term policy rate unchanged for a fifth straight meeting. Two board members, however, proposed raising the overnight call rate (OCR) to 0.75%.
Short-term rate (7-2 majority vote): The BoJ held the OCR steady at 0.50%. Dissenters, Takata Hajime and Tamura Naoki argued that the price stability target had been broadly achieved. With price risks now tilted to the upside, they called for the Bank to move policy closer to neutral.
Long-term rate: BoJ plans to reduce monthly Japanese government bond purchases to JPY2.0t by 1Q27.
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