Bank of Japan expected to stand pat on interest rates
Analysts say the central bank is likely to remain cautious following the trade deal with the US and as consumer prices remain stubbornly high.
The BOJ has stood pat on its policy rate for three consecutive meetings since March. This was amid uncertainties surrounding Japan-US tariff talks.
BOJ Deputy Governor Uchida Shinichi said the trade agreement announced last week by Tokyo and Washington may help ease some of those concerns.
But he added that the hard data is not yet available to measure how the deal will affect the Japanese and other economies.
BOJ officials agree that more time is needed to gauge the real impact of the tariff agreement on corporate profits and personal consumption.
In the meeting this week, the BOJ will also give its economic outlook through fiscal 2027.
The bank has indicated it will consider raising interest rates if the economy and prices move in line with forecasts.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
14 minutes ago
Mizuho Bank to Acquire AI Financial Venture
News from Japan Economy Jul 29, 2025 19:35 (JST) Tokyo, July 29 (Jiji Press)--Mizuho Financial Group Inc. said Tuesday that it will acquire Upsider Holdings Inc., a Tokyo-based financial venture that uses artificial intelligence to provide credit cards and accounting efficiency services for corporate clients. Mizuho Bank, the core subsidiary of the Japanese financial group, will purchase a 70 pct stake in the venture for some 46 billion yen and make it a consolidated subsidiary. Mizuho Bank aims to strengthen financial services for small businesses and startups. A specific joint business strategy will be announced in autumn. "We hope to address the labor shortage faced by small and midsize companies that support the Japanese economy and to improve their fundraising capabilities," Mizuho Financial Group President Masahiro Kihara told a news conference. In November 2023, Mizuho Financial Group and Upsider jointly established a debt fund for startups, providing a total of about 13 billion yen in loans. [Copyright The Jiji Press, Ltd.] Jiji Press
Japan Times
an hour ago
- Japan Times
Who buys the F-150s, and more Japan deal mysteries
The long-awaited trade deal between the U.S. and Japan has investors celebrating after months of uncertainty. But as the song goes, nagging questions always remain. Who is going to buy the "cars, SUVs and trucks' that U.S. President Donald Trump has promised to sell? Who is going to purchase the 100 Boeing jets? And what possible structure could the $550 billion fund, allegedly financed by Tokyo with 90% of profits going to U.S., actually take? Answers are sorely needed, not just because of an already growing comprehension gap between the countries over what was actually agreed, but to inform South Korea, the European Union and other close U.S. allies who are trying to wrap up similar deals before Aug. 1. Let's start with autos, long the main source of Trump's dissatisfaction with Tokyo, as well as the largest single cause of the trade deficit. The White House fact sheet (if indeed it can so be called) declared that "long-standing restrictions on U.S. cars and trucks will be lifted, granting U.S. automakers access to the Japanese consumer market.' Of course, U.S. carmakers have enjoyed unlimited access to the Japanese market for decades. As I noted in April, the problem is that U.S. cars just aren't good enough for the local consumer — and Detroit largely isn't interested in trying to muscle its way into a hyper-competitive market dominated by domestic players. Tokyo can try making it a little easier to import U.S. vehicles, such as simplifying inspection procedures. But it can't rebuild cities to fit the bloated models U.S. automakers favor. Around 84% of streets in Japan are municipal roads with an average width of just 3.7 meters (about 12 feet). Even if Tokyo gave everyone a Ford F-150 pickup, its 2.4-meter width would prevent two from passing on narrow streets. Hence cute minivans and kei-cars dominate while, as my colleague Liam Denning said this week, "U.S. automakers do not, in general, make an adorable little anything.' In any case, Japan's auto market has been shrinking for years, with new cars sold down about 20% from a 1990s peak. Automakers constantly fret that young people are losing interest in learning to drive, while the growing numbers of elderly citizens are encouraged to return their licenses. But more significant is what form the $550 billion investment fund will take. Treasury Secretary Scott Bessent said that the "innovative financing mechanism' was the key to Tokyo getting a deal at all. But neither side seems to agree on what it looks like. The idea first surfaced in May when the Financial Times reported that SoftBank Group founder Masayoshi Son had suggested a joint sovereign wealth fund. The White House calls it an "investment vehicle' that will "rebuild and expand core American industries.' Prime Minister Shigeru Ishiba, however, refers to a combination of equity, loans and guarantees that will be led by the Japan Bank for International Cooperation and guarantees by Nippon Export and Investment Insurance. That sounds more like overseas development aid than a wealth fund — though few could argue American infrastructure might actually benefit from that. Trump now promises Japan will "give us 90% of $550 billion!' Tokyo is saying that applies to projects where 90% of investment is from the U.S. — in other words, profits are proportional. Does the figure include funding already pledged, such as SoftBank's promised $100 billion? Who knows?! Indeed, a leaked photo from the talks shows what looks like a proposal from Japan for a $400 billion fund, crossed out with $500 billion handwritten on top. That proposal also suggested a 50% profit share. Is this just repackaged existing spending into a simple PowerPoint slide? After all, Japan already invested $783 billion in the U.S. in 2023 and Ishiba pledged in January to boost that to $1 trillion in the future. The problem is that at some stage, this needs to be worked into actual policies. And this is where Ishiba's rush to agreement might come back to bite, especially if he's no longer in the job when the talks get down to details — something that, despite his denials, still seems all but certain after the drubbing his Liberal Democratic Party took in recent Upper House elections. There are plenty of parts of the deal that do make sense. The 100 Boeings can find a home at the country's airlines, though Japan has admitted the number includes at least some already-planned purchases. As the world's largest buyer of liquid natural gas, Tokyo's participation in the Alaska project always seemed logical. Even if the two sides don't seem to agree on what they decided on defense, Japan needs to spend more and the U.S. is the logical seller. Above all, it's encouraging to see the White House, after all these months of tense relations, again describe its ally as the "cornerstone of peace in the Indo-Pacific.' But with all these questions — and Washington continuing to hold the threat over Japan's head with a quarterly evaluation of its compliance with the deal — the market's sigh of relief might still be premature. Gearoid Reidy is a Bloomberg Opinion columnist covering Japan and the Koreas.
NHK
2 hours ago
- NHK
Japan Finance Ministry upgrades economic assessment for Okinawa
Okinawa is enjoying an economic rebound thanks to some strong tourism numbers, according to Japan's Finance Ministry. Officials have upgraded their economic assessment for the southern island prefecture to "recovering", up from the previous "moderately recovering." The ministry's local bureau chiefs held a quarterly meeting on Tuesday, and said Okinawa is seeing a sharp rise in inbound visitor numbers, due in part to more flights. They said hotels and other tourism businesses are thriving, and retail sales are up. The officials said the opening last week of the Junglia Okinawa amusement park has helped to fill hotel rooms. But elsewhere the picture is less rosy. The ministry kept its assessment unchanged for all 10 other regions, and says the Japanese economy overall is picking up moderately, a phrase unchanged for two years.
