The bank of Japan stated that borrowing costs will remain at “present or lower” levels and maintained its minus 0.1 percent short-term interest rate goal.
The reforms come as customers grapple with growing living costs.
The Bank has also stated that it will keep buying large amounts of government bonds.
It’s been interpreted as an indication that the bank will continue to support the economy’s gradual recovery from the pandemic, even as consumer prices in Japan begin to climb.
As the interest rate differential between Japan and the rest of the globe continues to widen, the dollar has gained 15% against the yen so far this year.
The US dollar surged as high as 134.64 yen after the declaration, not far from the 24-year high of 135.6 reached earlier this week.
Bringing it to its highest level in 13 years, the Bank of England increased its main interest rate from 1percent to 1.25 percent on Thursday.
That happened after the US Federal Reserve raised interest rates by three-quarters of a percentage point to a range of 1.5 percent to 1.75 percent on Wednesday, the largest hike in in 30 years.
Senior Market Analyst, Asia Pacific, OANDA, Jeffrey Halley, said, “I expect financial markets to continue to put pressure on the yen, potentially pushing it to well over 140 against the dollar, as the Bank of Japan insists on capping interest rates at near zero, while the rest of the world hastily embarks on tightening to get on top of surging, non-transitory inflation globally.”
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