⁍ The Bank of Japan is seen slightly cutting its growth and price forecasts.
⁍ Many board members see no immediate need to expand stimulus.
⁍ Japan’s economy suffered its biggest postwar slump in the second quarter.
– Japan’s economy is in the midst of its worst slump since the end of World War II, and the country’s central bank is expected to do nothing today to help it. The Bank of Japan is expected to keep its key interest rates at zero to 0.25% and keep its yield curve control targets at -0.1% for short-term interest rates and 0% for long-term yields, reports the Wall Street Journal. But it is expected to signal its readiness to extend a crisis-response package introduced in March to combat the H1N1 virus, Reuters reports. “For the time being, the BOJ can respond to risks using the package of measures,” says a source familiar with the bank’s thinking. “Extending the deadline is a near certainty,” another source says. “The question is not whether, but when.” Japan’s economy suffered its biggest postwar slump in the second quarter and analysts expect any rebound to be modest, as uncertainty over the extent of the pandemic’s fallout weighs on consumption and capital expenditure.
Source: https://www.reuters.com/article/japan-economy-boj/boj-to-hold-fire-signal-readiness-to-extend-covid-response-package-idUSKBN27B0KW