The Bank of Japan (BOJ) published the summary of opinions of the monetary policy meeting of April 30 and May 1, 2025, with the key findings indicated below.
Outstanding comments
A member said that the BOJ will probably continue to increase interest rates according to the improvements in the economy and prices.
A member said that there are no changes in the increase in Boj rates since real interest rates are deeply negative, but risks must be examined.
A member said that uncertainty about the economy and pricing perspectives is high, and the probability of achieving the price objective is not as high as in the past.
A member said that the BOJ has no choice but to adopt a waiting position and see until the developments around the US commercial policy are stabilized to some extent.
A member said that the BOJ will enter a temporary pause in rates increases, but should not fall into excessive pessimism, policy must guide politics in an agile and flexible way.
A member said that the possibility that Japan’s underlying inflation is weakened is small.
A member said that the development of US commercial policy could become positive or negative at any time, which means that the Road of Boj’s policy could also change at any time.
A member said that our projections have been severely shaken by US commercial policy, with higher US tariffs that probably weigh on the economy and prices of Japan.
Market reaction
After the summary of Boj’s opinions, the USD/JPY torque has dropped 0.07% in the day to quote 148.20 at the time of writing.
Japan Faqs Bank
The Bank of Japan (BOJ) is the Japanese Central Bank, which sets the country’s monetary policy. Its mandate is to issue tickets and carry out monetary and foreign exchange control to guarantee the stability of prices, which means an inflation objective around 2%.
The Bank of Japan has embarked on an ultralaxa monetary policy since 2013 in order to stimulate the economy and feed inflation in the middle of a low inflation environment. The bank’s policy is based on the Quantitative and Qualitative Easing (QQE), or ticket printing to buy assets such as state or business bonds to provide liquidity. In 2016, the Bank redoubled its strategy and relaxed even more policy by introducing negative interest rates and then directly controlling the performance of its state bonds to 10 years.
The massive stimulus of the Bank of Japan has caused the depreciation of the Yen in front of its main monetary peers. This process has been more recently exacerbated due to a growing divergence of policies between the Bank of Japan and other main central banks, which have chosen to abruptly increase interest rates to combat inflation levels that have been in historical maximums. Japan Bank’s policy to maintain low types has caused an increase in differential with other currencies, dragging the value of YEN.
The weakness of the YEN and the rebound in world energy prices have caused an increase in Japanese inflation, which has exceeded the 2% objective set by the Bank of Japan. Even so, the Bank of Japan judges that the sustainable and stable achievement of the 2%objective is not yet glimpsed, so an abrupt change of current monetary policy seems unlikely.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
