BOJ Holds Rate at 0.5%, Decides to Sell ETFs
The Bank decided by a 7–2 vote to guide the uncollateralized overnight call rate to remain at around 0.5%. 12
Members Takata and Tamura each proposed raising the rate to around 0.75%, but the proposals were rejected by a majority. Takata cited a shift in the norm against price rises; Tamura cited growing upside risks to prices. 12
The Bank unanimously decided to sell its ETF and J-REIT holdings on the market, at a scale comparable to the earlier sale of stocks purchased from financial institutions. 1
The Governor said the sales will proceed at about 330 billion yen a year for ETFs and about 5 billion yen a year for J-REITs, both at book value. 1
The Bank judged that Japan's economy is recovering moderately, and that year-on-year core CPI is in the upper 2% range, affected by rising food prices such as rice. 12
The Governor said that if the outlook materializes, the Bank will continue to raise the policy rate, while stressing that uncertainty over trade policies remains high. 1