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The yuan firmed by more than 0.5% in both the onshore and offshore markets as investors cheered comments at the closely watched Politburo meeting, though many were still seeking specific details on greater stimulus measures. The yuan traded offshore was last at 7.1444 per dollar and in the onshore market it was at 7.1454 per dollar. Also propping up the yuan were China's major state-owned banks selling U.S. dollars to buy yuan in both onshore and offshore spot markets on Tuesday, sources told Reuters. The positive sentiment from China lifted the Australian dollar, often used as a liquid proxy for the yuan, which rose 0.4% to $0.6767. In Europe, the pound rose 0.22% to $1.2854, its first day of gains after seven straight sessions of losses, its longest such streak since March 2020.

Persons: Tommy Xie, Guillermo Felices, Ueda, Aninda Mitra, Rae Wee, Alun John, Shri Navaratnam, Lincoln, Christina Fincher Organizations: Reuters, European Central Bank, Federal Reserve, Bank of Japan, BNY Mellon Investment Management, Thomson Locations: SINGAPORE, LONDON, China, Europe, Asia, Singapore, London

☆ A 'momentous week' ahead as the Fed, ECB and Bank of Japan near pivot point
▼ + stars: | 2023-07-24 | by ( Elliot Smith | ) www.cnbc.com time to read: +7 min

Bloomberg | Bloomberg | Getty ImagesThe U.S. Federal Reserve, Bank of Japan and European Central Bank will all announce key interest rate decisions this week, with each potentially nearing a pivotal moment in their monetary policy trajectory. The Fed Each central bank faces a very different challenge. "The FOMC will, however, maintain a tight monetary policy stance to aid continued softening in demand and consequently, inflation." Several analysts over the past week have suggested that policymakers will remain "data dependent," but push back against any talk of interest rate cuts in the near future. ECB Chief Economist Philip Lane last month warned markets against pricing in cuts to interest rates within the next two years.

Persons: Goldman Sachs, Michael Cahill, Cahill, Steve Englander, Englander, Philip Lane, Paul Hollingsworth, Christine Lagarde, Hollingsworth Organizations: Bank of Japan, U.S, Bloomberg, Getty, . Federal Reserve, European Central Bank, ECB, Federal, Moody's Investors Service, Standard Chartered, Downside, Fed, BNP, Bank of Locations: U.S, North America, Bank of Japan, Japan

The European common currency fell 0.4% to $1.1083 , skidding after a quiet Asian session on PMI data that showed euro zone business activity shrank much more than expected in July. The pound dropped after British activity data, but less dramatically and was last down 0.1% at $1.2839. The yen strengthened with the dollar down 0.47% at 141.2 yen , and the euro down 0.7% at 156.6 yen. The Swiss franc was steady at 0.8648 per dollar, and the dollar index was up 0.1% at 101.2. Reporting by Tom Westbrook; Editing by David Holmes and Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.

Persons: Simon Harvey, Bob Savage, Tom Westbrook, David Holmes, Jacqueline Wong Organizations: SYDNEY, PMI, Reserve, European Central Bank, Bank of Japan, Investors, ECB, Fed, U.S, BNY Mellon, The Bank of Japan, Reuters, Commonwealth Bank of Australia, Swiss, Thomson Locations: LONDON, Europe, United States, Ukraine

Yet, with services price growth also slowing last month, policymakers will feel that wage pressures have yet to build up enough to warrant an imminent tweak to the ultra-loose monetary stance. We'll likely see inflation slow in coming months, which would allow the BOJ to keep policy steady for the time being," said Toru Suehiro, chief economist at Daiwa Securities. "While services prices may rise next year, those for goods will stay weak. "If more firms hike wages and pass on the cost, services prices could overshoot," said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute. "Inflation excluding food and energy will likely moderate ahead, but the pace of slowdown could be gradual."

Persons: We'll, Toru Suehiro, Kazuo Ueda, Yoshiki Shinke, Leika Kihara, Takahiko Wada, Sam Holmes Organizations: Bank of Japan, Daiwa Securities, Reuters Graphics Services, Dai, Research, Thomson Locations: TOKYO, Japan

Some market players bet the central bank could widen the allowance band set around its yield target to arrest market distortions caused by its heavy bond buying. With the 10-year yield moving stably below the 0.5% yield cap, however, many BOJ policymakers see no imminent need to take fresh steps against the side-effects of YCC, the sources said. Notwithstanding abrupt moves in the bonds and yen, the BOJ is likely to make no changes to its policy framework next week, they said. "We expect the BOJ will keep major policy levers unchanged next week," said Stefan Angrick, senior economist at Moody's Analytics. More than three-quarters of economists polled by Reuters said they expect the BOJ to keep policy steady including its yield control scheme next week.

Persons: Shinichi Uchida's, Kazuo Ueda's, Stefan Angrick, Leika Kihara, Takahiko Wada, Sam Holmes Organizations: Bank of Japan, Moody's, Reuters, Thomson Locations: BOJ, TOKYO

☆ Take Five: School's (not) out for summer
▼ + stars: | 2023-07-21 | by ( ) www.reuters.com time to read: +5 min

LONDON, July 21 (Reuters) - The peak holiday season is gearing up, but school's not quite out for summer in financial markets. Also in focus are earnings from some of the massive tech and growth stocks that have led markets higher this year. Reuters Graphics2/ SUMMER READINGBefore they go on their summer break, ECB policymakers have a well-flagged rate hike to deliver. Rate-setters' summer reading list just got longer. Second-quarter earnings are expected to decrease 9.2% from a year earlier, according to I/B/E/S data from Refinitiv, with aggregate earnings likely to be weighed down by poor performance from energy companies.

Persons: school's, Ira Iosebashvili, Kevin Buckland, Naomi Rovnick, Alun John, Dhara, Jerome Powell, Christine Lagarde, Kazuo Ueda's, Shinichi Uchida, Uchida, Ueda, Stocks, it's, Dhara Ranasinghe, Muralikumar Organizations: U.S . Federal Reserve, European Central Bank and Bank of Japan, Reserve, Microsoft, Reuters, ECB, Bank of Japan, Barclays, People's Party, Socialist Workers ' Party, Thomson Locations: Spanish, Ira, New York, Tokyo, London, Europe, SPAIN, Spain

☆ Japan's central bank has been 'wrong footed' on inflation, analyst says
▼ + stars: | 2023-07-21 | by ( Lim Hui Jie | ) www.cnbc.com time to read: +3 min

Bank of Japan Governor Kazuo Ueda arrives to conduct an interview with a small group of journalists in Tokyo on May 25, 2023. Richard A. Brooks | AFP | Getty ImagesAnalysts are split over the Bank of Japan's moves after the country's core inflation came in above the central bank's target of 2% for the 15th straight month. CLSA Japan strategist Nicholas Smith is of the view that the BOJ has been "wrong-footed" on inflation. Under the YCC policy, the central bank targets short-term interest rates at -0.1% and the 10-year government bond yield at 0.5% above or below zero, with the aim of maintaining the inflation target at 2%. To Smith, there is "plenty of probability" for the BOJ to shift its stance on YCC at the next central bank meeting next Friday.

Persons: Kazuo Ueda, Richard A, Brooks, Nicholas Smith, Smith, CNBC's, Tetsufumi Yamakawa, Yamakawa, I've Organizations: Japan, AFP, Getty, Bank of, Reuters, Barclays Locations: Tokyo, Japan

The nationwide core consumer price index (CPI), which excludes fresh food costs, rose 3.3% in June from a year earlier, matching a median market forecast. A hike in utility bills added to a steady increase in food and daily necessity prices, adding to the burden of households. But so-called "core core" inflation, which strips away both fresh food and fuel costs, slowed 4.2% in June from a 4.3% rise in May, a sign the rapid pace of increase seen in the past few months was moderating. As inflation perks up, markets are simmering with speculation the BOJ could soon phase out its controversial yield curve control (YCC) policy that is criticised for distorting market pricing and narrowing margins for financial institution. Under YCC, the BOJ guides short-term interest rates at -0.1% and buys huge amounts of government bonds to cap the 10-year bond yield around 0% as part of efforts to fire up inflation to its 2% target.

Persons: Kazuo Ueda's, Leika Kihara, Takahiko Wada, Sam Holmes Organizations: Bank of Japan, Thomson Locations: TOKYO, Japan

Summary BOJ has kept easy policy with eye on market functionSustained achievement of BOJ's price goal still distantUeda's remarks come amid speculation of July policy tweakJuly 18 (Reuters) - Bank of Japan (BOJ) Governor Kazuo Ueda said on Tuesday there was still some distance to sustainably and stably achieving the central bank's 2% inflation target, signalling his resolve to maintain ultra-loose monetary policy for the time being. "We have patiently continued our ultra-loose monetary policy under yield curve control (YCC)," with due consideration to the impact on financial intermediation and market function, Ueda told a news conference after attending a G20 finance leaders' meeting in India. Ueda said the BOJ will scrutinise at each policy meeting the pace of progress Japan was making in sustainably achieving its 2% target. "If our assumption (that sustained achievement of 2% inflation remains distant) is unchanged, our overall narrative on monetary policy remains unchanged," he said. Reporting by Leika Kihara and Tetsushi Kajimoto in Tokyo; Editing by Bernadette Baum and Christina FincherOur Standards: The Thomson Reuters Trust Principles.

Persons: Kazuo Ueda, Ueda, Leika Kihara, Bernadette Baum, Christina Fincher Organizations: Bank of Japan, Reuters, Thomson Locations: India, Japan, Tokyo

☆ Analysis: BOJ in a bind as price pressures heighten case for early policy tweak
▼ + stars: | 2023-07-14 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

But there's no clarity on what the final decision would be," said one of the sources on the chance of a policy shift in July. Lately, however, BOJ policymakers been dropping signs that inflation is being increasingly driven by improving consumer demand. CREDIBILITY ON LINEThere is no consensus within the BOJ on how soon it should start dialing back stimulus. Proponents of early action point to the rising cost of YCC, such as market distortions caused by the BOJ's huge bond buying. "A July policy tweak would contradict the logic the BOJ had been using to justify keeping easy policy," said Naomi Muguruma, senior market economist at Mitsubishi UFJ Morgan Stanley Securities.

Persons: Kazuo Ueda's reassurances, Ueda, Naomi Muguruma, Mitsubishi UFJ, Mitsubishi UFJ Morgan Stanley, Leika Kihara, Kim Coghill Organizations: Bank of, Mitsubishi, Mitsubishi UFJ Morgan, Mitsubishi UFJ Morgan Stanley Securities, Tokyo, Thomson Locations: TOKYO, Bank of Japan

☆ Dollar slides ahead of U.S. inflation data, sterling hits 15-month peak
▼ + stars: | 2023-07-12 | by ( ) www.cnbc.com time to read: +3 min

An old British £1 note is pictured with a one Dollar bill note on January 07, 2023 in Bath, England. U.S. inflation data is due later on Wednesday, with expectations core consumer prices rose 5% on an annual basis in June. The figures should also provide further clarity on the Federal Reserve's progress in its fight against inflation. "We're already seeing markets move in anticipation of a softer U.S. inflation report," said Matt Simpson, senior market analyst at City Index. "Speculation of a possible tweak could allow the yen some support ahead of the BOJ meeting this month."

Persons: BoE, Matt Simpson, Simpson, YCC, Jane Foley, that's, Susan Kilsby Organizations: Bank of England, U.S ., Fed, Bank of Japan, Rabobank, New Zealand, Reserve Bank of New, ANZ Locations: Bath, England, U.S, Tuesday's, Asia, Reserve Bank of New Zealand

☆ Dollar slumps ahead of US inflation data, sterling rises
▼ + stars: | 2023-07-12 | by ( Rae Wee | ) www.reuters.com time to read: +3 min

"The (RBNZ) statement and minutes retained their dovish undertone overall, but they can't not warn that inflation is still 'too high' as they need to contain inflation expectations," said Matt Simpson, senior market analyst at City Index. The broader market focus remained on U.S. inflation data due later on Wednesday, with expectations for core consumer prices to have risen 5% on an annual basis in June. "We're already seeing markets move in anticipation of a softer U.S. inflation report," said City Index's Simpson. U.S. Treasury yields came under pressure on Wednesday, with the two-year yield and benchmark 10-year yield settling below 5% and 4%, respectively. "Speculation of a possible tweak could allow the (yen) some support ahead of the BOJ meeting this month."

Persons: BoE, Matt Simpson, we've, Index's Simpson, Sterling, YCC, Jane Foley, Rae Wee, Jamie Freed, Edmund Klamann Organizations: Bank of England, New Zealand, Reserve Bank of New Zealand, U.S ., Fed, BoE . U.S, Treasury, Bank of Japan, Rabobank, Thomson Locations: SINGAPORE, U.S, Asia, BoE .

☆ Morning Bid: China disinflation a mix of good and bad
▼ + stars: | 2023-07-10 | by ( ) www.reuters.com time to read: +3 min

On the face of it, this implies there is plenty of scope to ease monetary and fiscal policy further. Yet it also underlines the scale of the challenge that Beijing faces in avoiding an outright deflationary spiral. Globally, a deflationary pulse from China could over time help to offset service-driven inflation in developed nations. Disinflation in goods is a major reason analysts expect coming U.S. CPI data to show a slowdown in June. One side effect of the surge in bond yields has been a shake-out of carry trades in the forex market.

Persons: Wayne Cole, Andrew Bailey, Jeremy Hunt, Mary Daly, Loretta Mester, Raphael Bostic, Edmund Klamann Organizations: CPI, Headline, Treasury, Bank of Japan, Bank of England, San, Cleveland, Atlanta, Thomson Locations: Wayne, Beijing, China

☆ Bank of Japan deputy governor Uchida vows to keep yield control for now, Nikkei reports
▼ + stars: | 2023-07-06 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

Summary BOJ 'strongly acknowledges' side-effects of YCC - UchidaUchida rules out chance of early end to negative ratesJapan seeing signs of change in corporate behaviour - UchidaTOKYO, July 7 (Reuters) - Bank of Japan (BOJ) Deputy Governor Shinichi Uchida said the central bank will maintain its yield curve control policy from the perspective of sustaining ultra-loose monetary conditions, the Nikkei newspaper reported on Friday. With inflation exceeding its 2% target for more than a year, markets are simmering with speculation the BOJ will tweak yield curve control (YCC) - a policy that guides short-term interest rates at -0.1% and caps the 10-year bond yield around 0%. Uchida said the BOJ "strongly acknowledges" the side-effects of YCC such as the impact on market function, according to Nikkei. But the central bank must support the economy amid recent signs of change in corporate wage and price-setting behaviour, Uchida was quoted as saying. Reporting by Leika Kihara; Editing by Leslie Adler and Sandra MalerOur Standards: The Thomson Reuters Trust Principles.

Persons: Uchida Uchida, Uchida TOKYO, Shinichi Uchida, Uchida, YCC, Leika Kihara, Leslie Adler, Sandra Maler Organizations: Bank of Japan, Nikkei, Thomson Locations: Japan

The greenback was down 0.18% at 1104 GMT to 144.44 yen , after rising 0.27% on Monday. However, the yen remained close to last week's almost eight-month low of 145.07 per dollar, which prompted Japan's Finance Minister Shunichi Suzuki to warn against excessive yen selling. Market activity was relatively subdued with U.S. markets closed for the July 4 public holiday. Across currency markets, investors remained on watch for possible intervention by Japanese authorities to stem yen losses. Tan said the dollar is likely to rise past 150 yen, which would make intervention "more likely than not".

Persons: Shunichi Suzuki, Alvin Tan, Masato Kanda, Janet Yellen, Charu, Tan, Harry Robertson, Ankur Banerjee, Kevin Buckland, Shri Navaratnam, Emma Rumney, Christina Fincher Organizations: LONDON, Japan's Finance, U.S, Federal, U.S ., Asia FX, RBC Capital Markets, Reserve Bank of Australia, Australian, Treasury, Reuters, Saxo Markets, Japan, Bank, Bank of, Thomson Locations: SINGAPORE, Asia, Bank of Japan, London, Singapore

☆ A.I., rate cuts and Japan's rebound: Asia stocks are looking 'much more promising' than U.S. peers
▼ + stars: | 2023-06-29 | by ( Lim Hui Jie | ) www.cnbc.com time to read: +6 min

The Japanese flag flutters over the Bank of Japan (BoJ) head office building (bottom) in Tokyo on April 27, 2022. At first glance, Asian stocks as a whole have more modest gains so far this year compared with their U.S. and European counterparts. But Asia is more economically diverse than Europe and the U.S., and there are still bright spots in the region, especially in Japan and South Korea. In April, the BOJ announced it will conduct a "a broad-perspective review of [its] monetary policy," which could span 12-18 months. But Lombard Odier still expects the BOJ to end the yield curve control policy before this review is over.

Persons: Kazuhiro Nogi, Nomura, Daniela Gombert, bode, Gombert, Kazuo Ueda, Ueda, Lombard Odier, Morgan Stanley, Google's Bard, Ernie Bot, Lombard, Marco Barresi, Barresi Organizations: Bank of Japan, Afp, Getty, U.S, Asia, Nomura, Nikkei, Bank of, Private, U.S . Federal, Chips, Lombard Odier Locations: Tokyo, Asia, Europe, U.S, Japan, South Korea, India, Southeast Asia, Bank of Japan, Indonesia, A.I, OpenAI, Taiwan, China

It was the first time the BOJ summary showed a board member explicitly mentioning the need for an early debate of a tweak to YCC, which contrasts with Governor Kazuo Ueda's remarks ruling out any imminent change in policy. Under YCC, the BOJ guides short-term interest rates at -0.1% and the 10-year bond yield around zero as part of efforts to sustainably achieve its 2% inflation target. Some market players bet the central bank could tweak YCC, such as by widening the allowance band set around the 10-year yield target, as early as July to address market distortions caused by its huge bond buying. FRESH YEN WORRIESYCC is also blamed by some analysts for causing an unwelcome yen fall that pushes up raw material import costs. However, Kanda stopped short of saying Japan was ready to take "decisive action" - language he used shortly before Japan stepped into the currency market last year.

Persons: policymaker, Kazuo Ueda's, Ueda, Daisaku Ueno, MItsubishi UFJ, MItsubishi UFJ Morgan Stanley, YCC, Masato Kanda, Kanda, Shunichi Suzuki, Japan's, Leika Kihara, Shri Navaratnam, Sam Holmes Organizations: Bank of Japan, MItsubishi, MItsubishi UFJ Morgan, MItsubishi UFJ Morgan Stanley Securities, Finance, Thomson Locations: TOKYO, Japan, Asia

☆ Bank of Japan member called for early revision of YCC at June meeting
▼ + stars: | 2023-06-26 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

TOKYO, June 26 (Reuters) - The Bank of Japan should discuss revising its yield curve control (YCC) policy at an early stage, a board member was quoted as saying at a June policy meeting, a summary of opinions at the rate review released on Monday. While the central bank should keep overall monetary policy ultra-loose, it should debate tweaking YCC to improve market function and mitigate its "high cost," the member was quoted as saying. It was the first time the BOJ summary showed a board member explicitly mentioning the need for an early debate of a tweak to YCC. "The Bank should maintain the overall framework of monetary easing for the time being," the member said. At the June meeting, the BOJ maintained ultra-easy monetary policy including its YCC targets - set at -0.1% for short-term interest rates and around 0% for the 10-year bond yield.

Persons: Naoki Tamura, Kazuo Ueda, Leika, Shri Navaratnam, Sam Holmes Organizations: Bank of Japan, Thomson Locations: TOKYO

☆ BOJ policymaker calls for keeping low rates, focus on wages
▼ + stars: | 2023-06-22 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

Noguchi also warned of risks to Japan's economy, such as uncertainty over global economic and market developments. Under yield curve control (YCC), the BOJ sets a -0.1% target for short-term interest rates and caps the 10-year bond yield around 0% to reflate growth and inflation. With inflation exceeding its target, markets are simmering with speculation the BOJ will soon tweak YCC due to criticism the policy is distorting market pricing and crushing financial institutions' profit margins. BOJ Governor Kazuo Ueda has stressed the need to keep monetary policy ultra-loose until there is more evidence wages will keep rising next year, helping Japan sustainably hit the 2% inflation target. Reporting by Leika Kihara Editing by Chang-Ran Kim and Sam HolmesOur Standards: The Thomson Reuters Trust Principles.

Persons: Asahi Noguchi, Noguchi, Seiji Adachi, Kazuo Ueda, Leika, Chang, Ran Kim, Sam Holmes Organizations: Noguchi, Global, Bank of Japan, Thomson Locations: Japan, TOKYO, Naha

☆ BOJ's Adachi sees only small chance of July policy tweak
▼ + stars: | 2023-06-21 | by ( Leika Kihara | ) www.reuters.com time to read: +4 min

"If market conditions don't change much from now, the chance of us tweaking yield curve control in July to arrest any distortion in the yield curve will be small," he said. The remarks were the strongest yet from a BOJ policymaker ruling out the chance of a policy tweak at the next meeting scheduled on July 27-28. Adachi said the BOJ must look at consumer price data for July onward to judge whether inflation was overshooting its baseline scenario. But there's high uncertainty over our baseline inflation outlook, so it's premature to tweak monetary policy," he said in a speech to Kagoshima business leaders. "The BOJ must humbly monitor price and wage developments, and respond not too quickly, but also not too slowly" the second member said.

Persons: Seiji Adachi, Adachi, Kazuo Ueda, Leika, Shri Navaratnam, Sam Holmes Organizations: Bank of Japan, Thomson Locations: KAGOSHIMA, Japan, Kagoshima

☆ BOJ's Adachi says it's premature to tweak ultra-loose policy
▼ + stars: | 2023-06-21 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

KAGOSHIMA, Japan, June 21 (Reuters) - Bank of Japan board member Seiji Adachi said it was too early to phase out ultra-loose monetary policy due to uncertainty over the price outlook, brushing aside expectations of an early tweak to its controversial yield curve control policy. "Amid huge uncertainty over the price outlook, there are upside and downside risks. "When considering whether it's appropriate to change monetary policy, we must carefully take into account such risks," he said. Adachi said distortions in the shape of the yield curve have dissolved, arguing that there was no need to tweak YCC now. But there's high uncertainty over our baseline inflation outlook, so it's premature to tweak monetary policy," he said.

Persons: Seiji Adachi, Adachi, Leika, Shri Navaratnam, Sam Holmes Organizations: Bank of Japan, Thomson Locations: KAGOSHIMA, Japan, U.S, Kagoshima

☆ Dollar drifts as traders weigh rate path; yen fragile
▼ + stars: | 2023-06-19 | by ( Ankur Banerjee | ) www.reuters.com time to read: +3 min

In an action-packed week of central bank decisions, the Federal Reserve left interest rates unchanged on Wednesday but hinted that further hikes were on the way to tame inflation. Investors, though, expect the central bank to be done with its tightening in July. On Monday, the yen touched a near seven-month low of 141.98 per dollar, having slid 1% on Friday. The yen also touched a fresh 15-year low against the euro of 155.32. The Australian dollar fell 0.32% to $0.686, while the kiwi eased 0.26% to $0.622.

Persons: Marc Chandler, Chandler, Jerome Powell's, Powell, Mansoor Mohi, uddin, Sterling, Ankur Banerjee, Muralikumar Organizations: U.S, Bank of Japan, Federal Reserve, European Central Bank, Bank of, Investors, Investor, Citi, Bank of Singapore, Thomson Locations: SINGAPORE, Bank of Japan, Bannockburn, New York, Singapore

But there's very high uncertainty on next year's wage negotiations and the sustainability of wage growth," Governor Kazuo Ueda told a briefing. The BOJ's decision contrasts sharply with that of the European Central Bank, which raised borrowing costs to a 22-year high on Thursday. NOT ENTIRELY DOVISHBank of Japan Governor Kazuo Ueda speaks at a group interview with media in Tokyo, Japan, May 25, 2023. The yen's recent decline could also heighten calls from politicians for the BOJ to tweak YCC, as it squeezes households and retailers by pushing up raw material import costs. "But it may be forced to act if the yen weakens further and drives up import costs, angering the public.

Persons: Ueda, Kazuo Ueda, Kim Kyung, We've, Izuru Kato, Leika Kihara, Kantaro Komiya, Sam Holmes, Kim Coghill Organizations: Bank of Japan, European Central Bank, U.S . Federal Reserve, REUTERS, Companies, Totan, Thomson Locations: TOKYO, Bank, Tokyo, Japan

As widely expected, the BOJ maintained its -0.1% short-term interest rate target and a 0% cap on the 10-year bond yield set under its yield curve control (YCC) policy. The yen fell broadly following the decision and hit a fresh 15-year low of 154.70 per euro and was set for the biggest weekly decline against the single currency in three years. Reuters GraphicsFED FACES GRIM DATAThe ECB's monetary policy decision came a day after the U.S. Federal Reserve left interest rates unchanged, snapping a string of 10 consecutive rate hikes. Production at U.S. factories almost stalled in May as manufacturing struggled under the weight of higher interest rates, while U.S. import prices similarly fell last month. Against a basket of currencies , the dollar index edged up 0.03% to 102.17, after slipping to a one-month low on Thursday.

Persons: we're, Kazuo Ueda, Hirofumi Suzuki, Goldman Sachs, Christine Lagarde, Shaun Osborne, Joice Alves, Rae Wee, Philippa Fletcher, Sohini Organizations: LONDON, Bank of Japan, European, Bank's, U.S, ECB, Sterling, Bank of England, Reuters Graphics, U.S . Federal Reserve, Fed, Labor Department, Scotiabank, Thomson Locations: SINGAPORE, United States, Europe, Toronto, London, Singapore

The BOJ's decision contrasts sharply with that of the European Central Bank, which raised borrowing costs to a 22-year high on Thursday and signalled the likelihood of further hikes. Also this week, the U.S. Federal Reserve on Wednesday signalled it was not yet done with its fight against inflation. As widely expected, the BOJ maintained its -0.1% short-term interest rate target and a 0% cap on the 10-year bond yield set under its yield curve control (YCC) policy. An upgrade to the BOJ's inflation forecast in a quarterly review in July is seen as a done-deal, though central bank officials have said a rise in inflation alone won't automatically trigger a policy shift. Ueda has said solid, sustained wage growth must accompany rising inflation for the BOJ to contemplate a policy tweak.

Persons: Kazuo Ueda's, Ueda's, Shigeto Nagai, Izuru Kato, Shunichi Suzuki, Ueda, Leika Kihara, Kantaro Komiya, Sam Holmes Organizations: Bank of Japan, European Central Bank, U.S . Federal Reserve, Oxford Economics, Totan, Graphics, Thomson Locations: TOKYO, Japan

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