The Bank of Japan left its key short-term interest rate unchanged at -0.1 percent at its October meeting and kept the target for the 10-year Japanese government bond yield at around zero percent, as widely expected. The central bank also revised down inflation forecasts again, saying that the momentum toward achieving the price stability target of 2 percent is not sufficiently firm despite years of massive monetary easing. Interest Rate in Japan averaged 2.81 percent from 1972 until 2018, reaching an all time high of 9 percent in December of 1973 and a record low of -0.10 percent in January of 2016.

Interest Rate in Japan is expected to be -0.10 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Japan to stand at 0.00 in 12 months time. In the long-term, the Japan Interest Rate is projected to trend around 0.10 percent in 2020, according to our econometric models.

Japan Interest Rate
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Calendar GMT Actual Previous Consensus TEForecast
2018-06-15 03:00 AM BoJ Interest Rate Decision -0.1% -0.1% -0.1% -0.1%
2018-07-31 04:00 AM BoJ Interest Rate Decision -0.1% -0.1% -0.1% -0.1%
2018-09-19 03:00 AM BoJ Interest Rate Decision -0.1% -0.1% -0.1% -0.1%
2018-10-31 03:00 AM BoJ Interest Rate Decision -0.1% -0.1% -0.1% -0.1%
2018-12-20 03:00 AM BoJ Interest Rate Decision -0.1% -0.1% -0.1%
2019-01-23 03:00 AM BoJ Interest Rate Decision
2019-01-23 03:00 AM BoJ Quarterly Outlook Report



BoJ Holds Rates, Lowers Inflation Forecasts



The Bank of Japan left its key short-term interest rate unchanged at -0.1 percent at its October meeting and kept the target for the 10-year Japanese government bond yield at around zero percent, as widely expected. The central bank also revised down inflation forecasts again, saying that the momentum toward achieving the price stability target of 2 percent is not sufficiently firm despite years of massive monetary easing.

The inflation forecast for the fiscal year ending March 2019 was lowered to 0.9 percent from 1.1 percent previously estimated. Also, the central bank now expects inflation to average 1.4 percent for fiscal 2019 (vs 1.5 percent) and 1.5 percent for fiscal 2020 (vs 1.6 percent).

With regard to the amount of JGBs to be purchased, the Bank will conduct purchases in a flexible manner so that their amount outstanding will increase at an annual pace of about 80 trillion yen. 

The BoJ also determined by an unanimous vote to purchase ETFs and Japan real estate investment trusts (J-REITs) so that their amounts outstanding will increase at an annual paces of about 6 trillion yen and about 90 billion yen, respectively. As for CP and corporate bonds, the Bank will maintain their amounts outstanding at about 2.2 trillion yen and about 3.2 trillion yen, respectively.  

Excerpts from the Outlook for Economic Activity and Prices:

Japan's economy is likely to continue its moderate expansion. In fiscal 2018, domestic demand is likely to follow an uptrend, with a virtuous cycle from income to spending being maintained in both corporate and household sectors, mainly against the background of highly accommodative financial conditions and the underpinnings through government spending. Business fixed investment is likely to continue increasing amid accommodative financial conditions, led mainly by investment intended for domestic capacity expansion in line with the economic expansion, Olympic Games-related investment, and labor-saving investment to address the labor shortage. Private consumption is also expected to follow a moderate increasing trend as emplyment and income situation continues to improve. Public investment is expected to remain at a relatively high level, mainly reflecting Olympic Games-related demand and the supplementary budgets. Exports are expected to continue their moderate increasing trend on the back of the firm growth in overseas economies.

Meanwhile, the year-on-year rate of change in the consumer price index, all items less freah food, has been posiive but has continued to show relatively weak developments compared to the economic expansion and the labor market tightening. Under these circumstances, a rise in medium to long-term inflation expectations has been lagging behind. Nonetheless, with the output gap rmeining positive, firms' stance in expected to gradually shift toward further raising wages and prices and households' tolerance of price rises will increase. 

With regard to the risks balance, risks to both economic activity and prices were skewed to the downside. On the price front, the momentum toward achieving the price stability target of 2 percent is maintained but is not yet suffficiently firm, and developments in prices continue to warrant careful attention. 



Bank of Japan | Rida | rida@tradingeconomics.com
10/31/2018 7:55:53 AM



Japan Money Last Previous Highest Lowest Unit
Interest Rate -0.10 -0.10 9.00 -0.10 percent [+]
Interbank Rate -0.11 -0.11 8.50 -0.12 percent [+]
Money Supply M0 100372.80 100117.40 100372.80 2130.10 JPY Billion [+]
Money Supply M1 766258.60 763800.50 766258.60 3921.00 JPY Billion [+]
Money Supply M2 1010519.40 1007530.80 1010519.40 8404.00 JPY Billion [+]
Money Supply M3 1342945.60 1342560.40 1342945.60 1008505.00 JPY Billion [+]
Central Bank Balance Sheet 555501.00 551805.40 555501.00 4864.50 JPY Billion [+]
Foreign Exchange Reserves 1258300.00 1252900.00 1306668.00 455.00 USD Million [+]
Loans to Private Sector 460208.50 460417.30 536555.80 375948.90 JPY Billion [+]
Deposit Interest Rate 0.32 0.30 5.50 0.04 percent [+]
Foreign Stock Investment -446.60 -137.90 1577.40 -2162.40 JPY Billion [+]
Foreign Bond Investment 1241.40 1053.50 2549.70 -3072.10 JPY Billion [+]
Private Debt to GDP 229.40 227.00 291.90 227.00 percent [+]
Loan Growth 2.10 2.20 3.60 -5.00 percent [+]


Japan Interest Rate

In Japan, interest rates are set by the Bank of Japan's Policy Board in its Monetary Policy Meetings. The BoJ's official interest rate is the discount rate. Monetary Policy Meetings produce a guideline for money market operations in inter-meeting periods and this guideline is written in terms of a target for the uncollateralized overnight call rate. This page provides - Japan Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. Japan Interest Rate - actual data, historical chart and calendar of releases - was last updated on December of 2018.

Actual Previous Highest Lowest Dates Unit Frequency
-0.10 -0.10 9.00 -0.10 1972 - 2018 percent Daily




Country Last Previous
Argentina 59.16 Dec/18
Turkey 24.00 Dec/18
Mexico 8.00 Nov/18
Russia 7.75 Dec/18
South Africa 6.75 Nov/18
Brazil 6.50 Dec/18
India 6.50 Dec/18
Indonesia 6.00 Nov/18
China 4.35 Nov/18
Saudi Arabia 2.75 Nov/18
United States 2.25 Nov/18
Singapore 1.97 Nov/18
Canada 1.75 Dec/18
South Korea 1.75 Nov/18
Australia 1.50 Dec/18
United Kingdom 0.75 Nov/18
Euro Area 0.00 Dec/18
France 0.00 Dec/18
Germany 0.00 Dec/18
Italy 0.00 Dec/18
Netherlands 0.00 Dec/18
Spain 0.00 Dec/18
Japan -0.10 Nov/18
Switzerland -0.75 Dec/18


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