Japan Interest Rate  1972-2018 | Data | Chart | Calendar | Forecast | News

The Bank of Japan vowed to keep rate extremely low for extended period of time and opted for flexible bond buying at its July 2018 meeting. At the same time, policymakers left its key short-term interest rate unchanged at -0.1 percent and kept its 10-year government bond yield target around 0 percent. Interest Rate in Japan averaged 2.83 percent from 1972 until 2018, reaching an all time high of 9 percent in December of 1973 and a record low of -1 percent in July of 2018.

Japan Interest Rate
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BoJ Introduces More Policy Flexibility

The Bank of Japan left its key short-term interest rate unchanged at -0.1 percent and vowed to keep rates extremely low for an extended period of time at its July 2018 meeting. The central bank reinforced its commitment to continue with powerful monetary easing, defying speculations of a tight regime. At the same time, the central bank kept its 10-year government bond yield target at around 0 percent but said the yield could fluctuate depending on economic and price developments. The 10-year yield will now rise up to around 0.20 percent, from around 0.10 percent before. Policymakers also opted for flexible bond buying, saying they may increase or decrease the amount of purchases depending on market conditions.

The central bank intended to maintain the current extremely low levels of short-and long-term iterest rates for an extended period of time, taking into account uncertainties regarding economic activity and prices including the effects of the consumption tax hikes scheduled to take place in October 2019.

With regard to the amount of JGBs to be purchased, the BoJ determined by an unanimous vote to purchase exchange-traded funds (ETFs) and Japan real estate investment trusts (J-REITs) so that their amounts outstanding will increase at an annual paces of about JPY 6 trillion and about JPY 90 billion, respectively. With a view to lowering risk premia of asset prices in an appropriate manner, tha bank may increase or decrease the amount of purchase depending on market conditions. 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.  

In addition, under the condition that yield curve control can be conducted appropriately, the bank will reduce the size of the Policy-Rate Balance in financial institutions' current account balances at the bank. This balance is calculated assuming that arbitrage transactions take place in full among financial institutions. Regarding the amount of each ETF to be purchased, the bank will revise the purchase amount of each ETF and increase that ETF's which track the Tokyo Stock Price Index (TOPIX).

Meanwhile in a quarterly review of the central bank's forecasts, the BOJ said medium-to-long-term inflation expectations are projected to rise gradually as firms' stance gradually shifts toward further raising wages and prices with the output gap remaining positive. As a consequence, the year-on-year rate of change in the CPI is likely to increase gradually toward 2 percent, although it will take more time than expected. For fiscal 2018, core CPI is projected to rise by 1.1 percent, down from an earlier forecast of 1.3 percent. At the same time, the economy is expected to expand by 1.5 percent, more or less unchanged from  a 1.6 percent expansion in the previous estimate.

Excerpts from the Outlook for Economic Activity and Prices:

Japan's economy is likely to continue at a pace above its potential in fiscal 2018, mainly against the background of highly accommmodative financial conditions and the underpinning through government spending, with overseas economied continuing to grow firmly. From fuscal 2019 through fiscal 2010, the economy is expected to continue on an expanding trend, partly supported by external demand, although the growth pace is projected to decelerate due to a cyclical slowdown in business fixed investment and the effects of the scheduled consumption tax hike.

With regard to the risk balance, upside and downside risks to economic activity are generally balanced in fiscal 2018, but skewed to the downside for fiscal 2019 onward.

Bank of Japan l Rida | rida@tradingeconomics.com
7/31/2018 10:35:52 AM

Calendar GMT Actual Previous Consensus TEForecast
2018-04-27 03:00 AM BoJ Interest Rate Decision -0.1% -0.1% -0.1% -0.1%
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%
2018-10-31 03:00 AM BoJ Interest Rate Decision -0.1%
2018-10-31 05:00 AM BoJ Quarterly Outlook Report

Japan Money Last Previous Highest Lowest Unit
Interest Rate -0.10 -0.10 9.00 -0.10 percent [+]
Interbank Rate -0.03 -0.03 8.50 -0.08 percent [+]
Money Supply M0 99787.40 99060.80 99787.40 2130.10 JPY Billion [+]
Money Supply M1 760740.80 759469.40 760740.80 3921.00 JPY Billion [+]
Money Supply M2 1007514.70 1007170.90 1007514.70 8404.00 JPY Billion [+]
Money Supply M3 1335285.50 1333208.50 1335285.50 1008505.00 JPY Billion [+]
Central Bank Balance Sheet 546310.80 537016.80 546310.80 4864.50 JPY Billion [+]
Foreign Exchange Reserves 1256300.00 1258700.00 1306668.00 455.00 USD Million [+]
Loans to Private Sector 458097.40 456475.70 536555.80 375948.90 JPY Billion [+]
Deposit Interest Rate 0.30 0.40 5.50 0.04 percent [+]
Foreign Stock Investment -107.10 -224.80 1568.80 -2162.40 JPY Billion [+]
Foreign Bond Investment 123.90 1164.00 2549.70 -3072.10 JPY Billion [+]
Private Debt to GDP 229.40 227.00 291.90 227.00 percent [+]
Loan Growth 2.00 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 August of 2018.

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

interest rate by Country
Country Last
Turkey 17.75 Jul/18
Mexico 7.75 Aug/18
Russia 7.25 Jul/18
Brazil 6.50 Aug/18
India 6.50 Aug/18
Indonesia 5.50 Aug/18
China 4.35 Jul/18
United States 2.00 Aug/18
Australia 1.50 Aug/18
Canada 1.50 Jul/18
South Korea 1.50 Jul/18
United Kingdom 0.75 Aug/18
Euro Area 0.00 Jul/18
France 0.00 Jul/18
Germany 0.00 Jul/18
Italy 0.00 Jul/18
Netherlands 0.00 Jul/18
Spain 0.00 Jul/18
Japan -0.10 Jul/18
Switzerland -0.75 Jul/18