The Bank of Japan (BoJ) decided to leave its short-term interest rate unchanged at 0.75% today, Tuesday, April 28, 2026.
The "Hawkish Hold" & Split Vote
While the decision to hold was widely expected, the meeting revealed a significant internal divide.
- 6–3 Split Vote: This is the largest dissent under Governor Kazuo Ueda's leadership.
- Dissenting Members: Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa all voted for an immediate hike to 1.0%.
- Hawkish Signals: The dissenters argued that inflationary risks are skewed to the upside due to the ongoing Iran war and rising energy costs.
Revised Economic Outlook
The April 2026 Outlook Report showed a stark shift in expectations:
- Inflation Surge: The FY2026 core inflation forecast was sharply raised to 2.8% (up from 1.9%).
- Growth Slump: The real GDP growth forecast for FY2026 was halved to 0.5% (down from 1.0%), reflecting the drag from high energy prices and the Strait of Hormuz closure.
Market Impact
- Yen (JPY): The Japanese yen saw a brief rally to a one-week high against the dollar, trading around 158.98–159.50, as traders priced in a higher probability (now 75%) of a rate hike in June.
- Equities: The Nikkei 225 slipped 0.6% to end below 60,200, retreating from its recent record highs.
Follow-up: Would you like a more detailed look at the June rate hike probabilities or the full text of Governor Ueda’s post-meeting press conference?
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