The Bank of Japan decided to keep interest rates unchanged on Thursday, but reiterated its pledge to continue raising borrowing costs if the economy moves in line with its expectations.
The central bank kept short-term interest rates unchanged at 0.5 percent, as expected.
Bank of Japan board members Naoki Tamura and Hajime Takata opposed the decision, and reintroduced a proposal they had made in September to raise interest rates to 0.75 percent.
In its quarterly outlook report released Thursday, the Council slightly revised its economic growth forecast for the current fiscal year ending in March 2026. It also raised its inflation forecast for fiscal year 2026.
The Bank of Japan also said it expects inflation to reach 2 percent in the latter half of the three-year forecast period ending in March 2027.
He maintained his view that the risks to inflation expectations were roughly balanced.
The Bank of Japan said in the report that if its economic and price forecasts are met, it will continue to raise interest rates and adjust the degree of monetary support in accordance with improvements in the economy and prices.
