BOJ Holds Steady on Rates Amid Inflation Watch

The Bank of Japan has maintained its interest rates, reflecting a cautious approach in assessing wage hikes' impact on inflation. The decision, made by an 8-1 vote, will be detailed by Governor Kazuo Ueda during a press conference. Additionally, BOJ evaluates unconventional monetary policies from past deflation measures.

The Bank of Japan decided to keep its interest rates unchanged on Thursday, indicative of a cautious strategy as policymakers monitor whether wage increases effectively sustain inflation at the 2% benchmark. The decision, anticipated by many, came down to an 8-1 vote, with dissent from board member Naoki Tamura.

Governor Kazuo Ueda is set to address the media at 3:30 p.m. (0630 GMT) to elaborate on the bank's policy stance. Alongside the rate announcement, the BOJ disclosed its analysis of the benefits and drawbacks of the unconventional monetary easing techniques utilized during its extensive 25-year struggle with deflation. This policy review process was initiated by Ueda upon his appointment as head of the bank in April of the previous year.

The move to evaluate these unconventional tools signals a strategic shift towards possibly winding down the BOJ's extensive stimulus measures, a reflection of changing economic conditions and the central bank's adaptive responses to them.

(With inputs from agencies.)