Japan's central bank maintains policy, warns of economic slowdown

Japan's central bank maintains policy, warns of economic slowdown

The Bank of Japan (BOJ) on Wednesday left its key short-term interest rate unchanged and maintained the size of its asset-buying fund to aid corporate investment and spending, but warned about slower growth domestically and downside risks from overseas economies.

BOJ governor Masaaki Shirakawa and his nine-member policy board voted unanimously to hold the central bank's key interest rate at between zero and 0.1 percent, in a widely anticipated move.

The board also all agreed that the bank's asset-buying fund should remain unchanged at 20 trillion yen (260 billion U.S. dollars) and its funding program for commercial banks held constant at 35 trillion yen.

Following the BOJ's two-day policy board meeting the central bank lowered its assessment of Japan's economy stating that it had "continued picking up, but at a more moderate pace."

"The economy will face an adverse effect from the slowdown in overseas economies and the appreciation of the yen as well as from the flooding in Thailand before recovering," the BOJ also said.

"After that, the economy is expected to return to a moderate recovery path as the pace of recovery in overseas economies picks up, led by emerging and commodity-exporting economies, and reconstruction-related demand after the earthquake disaster gradually materializes," it added in the statement.

The central bank also expected year-on-year rate of change in the CPI to remain at around zero percent for the time being.

Editor: Yang Lina

English.news.cn   2011-11-16 16:52:13 FeedbackPrintRSS
TOKYO, Nov. 16 (Xinhua)