The Bank of Japan decided to defer an additional rate hike and leave the policy rate unchanged at around 1.25%. The Outlook Report said that the underlying inflation rate was broadly consistent with the 2% target and presented the view that it had effectively reached that level.
At the monetary policy meeting that had just concluded, the Bank of Japan decided to defer an additional rate hike and maintain its existing policy of setting the policy rate at around 1.25%. In the Outlook Report released at the same time, it stated that the underlying inflation rate was broadly consistent with the 2% price stability target.
This led to the view that the 2% inflation target had effectively been reached, and Governor Ueda Kazuo (植田 和男) was expected to explain the decision at an afternoon press conference.
According to reports, the inflation rate was judged to have reached 2% on an underlying basis, but no additional guidance had been provided at that point on when rate hikes or a policy shift might resume. Market attention was focused on the press conference and the framework for future policy operations.