Bank of Japan Holds Overnight Rate Steady at 0.10%

As expected, the Bank of Japan left its overnight policy rate steady at 0.10%, for the eighth consecutive meeting. The Board felt that recent developments have indicated that the world’s second-largest economy had “begun to stop worsening.” Despite continued weakness in domestic demand and deteriorating corporate profits, exports may shed some light. The statement cited that “exports and production have begun to turn upward, and public investment has also increased.” In fact, shrinking Vehicle Sales in the 12 months through May slowed to -19.4% from -28.6% through April while Industrial Production made gains for the second month.