BOJ announces no change to JGB Yield Curve Control tolerance band, as widely expected

Statement from the Bank of Japan after its June 2023 monetary policy meeting.

No change.

  • BOJ maintains short-term interest rate target at -0.1%
  • maintains 10-year
    JGB yield target around 0%
  • maintains band
    around 10-year JGB yield target at up and down 0.5% each
  • made decision on YCC
    by unanimous vote

The BOJ made an amendment to the principal terms and conditions of the Complementary Deposit Facility

  • But adds that there is no change
    in the framework of the Complementary Deposit Facility and the
    interest scheme to promote lending

The BOJ on the economy:

  • Japan’s economy picking up
  • Japan’s economy
    likely to continue recovering moderately
  • Japan’s core
    consumer inflation likely to slow pace of increase towards middle of
    current fiscal year
  • Exports, output
    moving sideways
  • Capex increasing
  • Consumption
    increasing moderately
  • Inflation
    expectations moving sideways after heightening
  • Uncertainty
    regarding Japan’s economy is very high

Note that the BOJ again repeats it expects the pace of inflation to slow from the middle of this Fiscal Year. This would be around September/October (Japan’s Fiscal Year begins on April 1).

The impact of the announcement has been a move higher for yen crosses. What little doubt there was about BOJ policy change has been removed until the next meeting, scheduled for July 27 & 28. Nikkei 225 futures are up also.


Due later:

  • Bank of Japan Governor Ueda press conference at 0630 GMT (0230 US Eastern time)

This article was written by Eamonn Sheridan at Source