Bank of Japan keeps low rates as Kuroda sticks to script at swan song meeting | CNN Business

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The Bank of Japan maintained ultra-low interest rates on Friday

Though widely expected by most analysts, the decision sent the yen and local bond yields tumbling as some investors unwound bets retiring central bank governor Haruhiko Kuroda would tweak the yield curve control at his last policy meeting. Kuroda leaves the bank with a mixed legacy: His massive stimulus is praised for pulling the economy out of deflation, but straining bank profits and distorting market function with prolonged low interest rates.

“The BOJ will likely abandon its 10-year bond yield target, while maintaining negative interest rates, to arrest distortions in the yield curve,” he said. For now, the BOJ maintained its dovish guidance on the future policy path, saying that it expects short- and long-term policy rates to remain “at their present or lower levels.” The BOJ kept unchanged its view Japan’s economy will likely recover.

 

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