BoJ holds rate, makes no change to yield range

• Bank of Japan surprised markets by keeping its yield curve tolerance band unchanged.
• The Bank of Japan also left its interest rate unchanged at an ultra-dovish -0.1% – in line with expectations and maintaining the same rate it’s kept since 2016.
• The decision to make no changes to its monetary policies comes after the central bank caught global markets off guard in its previous meeting by widening its tolerance range for the yield on its 10-year government bond from 25 basis points to 50 basis points in December.
• “Japan’s economy is projected to continue growing at a pace above its potential growth rate,” the central bank said in a statement.
• The Bank of Japan revised its forecasts for 2023′s core inflation nationwide from 2.9% to 3%. Nationwide inflation data is expected Friday.
• Meantime, in a quarterly outlook report, the board cut slightly its 2022 GDP growth forecast to 1.9% from 2.0%, citing slowdowns in overseas economies and high commodity prices. For FY 2023, the bank also slashed its GDP outlook to 1.7% from 1.9%.
• The BoJ reiterated it will take extra easing measures if needed while expecting short-and long-term policy interest rates to stay at their present or lower levels.
• ETFs: JEQ, EWJ, DXJ, FXY.