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    BOJ Keeps Policy Steady Even As It Cuts Price View, Spurs Yen Spike

    (Jun 15 Reuters) The Bank of Japan kept monetary policy steady on Thursday even as sluggish global growth and anemic inflation put policymakers under pressure to do more to reflate the economy out of stagnation, bolstering the yen and battering Tokyo stocks.

    While the central bank maintained its optimistic view of the economy, it cut its view on consumer inflation to say prices were likely to fall slightly year-on-year or hover around flat for the time being.

    The yen rose more than 1 percent against the dollar to hit a 20-month high, while the Nikkei stock average fell 2 percent after the BOJ's decision. 

    "There is nothing in recent economic indicators that would lead the BOJ to change its economic outlook now," said Norio Miyagawa, senior economist at Mizuho Securities.

    "However, the rising yen will place more downward pressure on consumer prices, so I expect the BOJ to ease in July, using all three dimensions of its current policy framework."

    The BOJ maintained its massive asset buying program at the two-day rate review that ended on Thursday, pledging to increase base money at an annual pace of 80 trillion yen. ($753 billion). 

    It also left unchanged a 0.1 percent negative interest rate applied to some of the excess reserves financial institutions parked with the central bank. The decision to maintain the base money target was made by an 8-1 vote, while maintaining the 0.1 percent negative rate was agreed in a 7-2 vote.

    Click on the link below to see the full story from Reuters: (by Leika Kihara)

    BOJ keeps policy steady even as it cuts price view, spurs yen spike

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