FX.co ★ BoJ Holds Rates, Slows Bond-Buying Tapering After April 2026

In its June meeting, the Bank of Japan (BoJ) decided to maintain its key short-term interest rate at 0.5%, a level not exceeded since 2008, aligning with market predictions. This unanimous decision reflects a cautious stance due to ongoing uncertainties surrounding U.S. tariff policies, which may impact global economic expansion. As the BoJ continues to gradually scale back its historically accommodative monetary policy, it reiterated its commitment to reduce Japanese government bond (JGB) purchases by 400 billion yen each quarter until March 2026. Moreover, it announced plans to further decrease its JGB purchases by 200 billion yen per quarter starting in April 2026. With this staggered strategy, the BoJ aims to curb its monthly bond purchasing to 2 trillion yen by the first quarter of 2027.