Nikkei reports the Bank of Japan intends to hold its policy rate at 1% at the
July 30-31 meeting; a majority of the nine-member policy board is expected to
vote to maintain rates. Board members broadly view financial conditions as
accommodate and acknowledge a case for further rate hikes to stabilize
inflation, but many say there is no urgency to act. Some members had pushed for
a follow-up increase in July after June’s hike; the BOJ is closely monitoring
the effects of June’s move amid Middle East tensions and oil-price inflation
risk. The committee may raise its fiscal 2026 median real GDP growth forecast
from April’s 0.5% as economic conditions have improved — alternative Middle East
oil supplies have increased, corporate output concerns have eased, and
AI-related sectors have outperformed expectations, supporting growth.
