Bank of Japan remains optimistic despite new pandemic curbs’ impact on economy
The Bank of Japan is set to offer a cautiously optimistic outlook of the economy in new quarterly projections on Friday. Japan grapples anew with the COVID-19 pandemic, with state of emergency curbs hurting consumption and growth greatly dependent on overseas demand.
The central bank will also provide details on its plan to boost funding for the country’s efforts to fight climate change following economic fallout driven by climate risks.
The BOJ is expected to maintain its yield curve control (YCC) targets at -0.1% for short-term interest rates and 0% for 10-year bond yields.
Some sources said the board will slash its current 4.0% forecast on economic growth for the fiscal year ending in March 2022.
However, the BOJ remains firm on the economy’s moderate recovery outlook, even considering a slight upgrade for next fiscal year’s growth forecast. The board believes steady vaccinations will improve demand.