The Bank of Japan voted unanimously to keep borrowing costs on hold at 0.50% as expected, citing slowing domestic growth, sluggish exports, and tension in the global financial markets. Policy markets did warn against the risk of keeping rates low for too long, citing rising global inflation trends. That said, Governor Maasaki Shirakawa stressed policy flexibility given the current turmoil in the credit markets. The bank followed the lead of other global monetary authorities, adding another 1 trillion yen to grease the wheels of the financial system. The BOJ has injected a total of over 5 trillion yen ($47 billion dollars) into the market since number-four US investment bank Lehman Brothers declared bankruptcy while Merrill Lynch had to sell out to Bank of America.
For a complete list of this week’s data releases, please see the DailyFX Economic Calendar.