The Policy Board of the Bank of Japan voted 8-1 to keep its guideline for money-market operations unchanged, continuing to guide the uncollateralised overnight call rate at “around 0.75%,” judging that the economy is recovering moderately while inflation has eased to about 2 percent as government energy subsidies take effect and food-price pressures abate. After a 25 bp hike to 0.75 percent in December 2025, the rate has been held steady at the January and now the 19 March 2026 meetings. Financial conditions remain accommodative, with real rates “significantly low,” corporate profits high despite tariff headwinds, business investment on a moderate uptrend, resilient private consumption supported by a firm labour market, and inflation expectations rising moderately. The Bank expects headline CPI (ex-fresh food) to dip below 2 percent in the near term before picking up again on higher oil prices, while underlying inflation is projected to move gradually toward a level “generally consistent” with the 2 percent target in the latter half of the January 2026 Outlook horizon. Heightened crude-oil prices linked to Middle East tensions and uncertainties around global trade policies pose key external risks, and the central bank cautioned that future FX and financial-market volatility could affect prices. It reiterated that, should the baseline outlook be realised, it will continue to raise the policy rate and scale back monetary accommodation in pursuit of sustainable and stable achiev
Bank of Japan 2026-03-19
BOJ holds policy rate steady at around 0.75%
Bank of Japan voted 8–1 to keep the uncollateralised overnight call rate at around 0.75%, judging the recovery intact and inflation near 2%, and reiterated that, contingent on its baseline outlook, it plans further rate hikes to secure its price-stability goal.