BOJ Holds Monetary Policy Steady, Revises 2021 GDP Forecast Higher

At its latest meeting earlier today, the Bank of Japan decided to hold its monetary policy unchanged and turned more upbeat about Japan’s economic outlook for the next fiscal year. The BOJ maintains the view that it has rolled out adequate monetary stimulus to support the Japanese economy through the coronavirus crisis, even though it highlighted the risks that the latest round of restrictions posed to economic recovery.

Japan’s government imposed a second state of emergency across Tokyo and other parts of the country a few weeks ago and has since extended it in a bid to curb the spread of fresh infections. However, these restrictions are likely to hurt the already fragile consumer consumption, which could hold back economic recovery.

On a positive note, however, the BOJ has revised growth forecasts higher in its latest quarterly projections, supported by a rebound in exports and the rollout of the most recent fiscal stimulus measures by the government. While the central bank now expects Japan’s economy to contract by 5.6% instead of 5.5% previously, it has raised next year’s GDP estimates higher from 3.6% to 3.9%.

In its report, the BOJ observes, “Our projections could change depending on developments regarding the pandemic and how they affect domestic and overseas economies. Uncertainty is therefore extremely high.”

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
0 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments

HFM

Doo Prime

XM

Best Forex Brokers