TOKYO, April 28 (Xinhua) -- The Bank of Japan (BOJ) decided by a majority vote to keep its benchmark interest rate unchanged at around 0.75 percent after concluding its two-day monetary policy meeting on Tuesday.
The widely expected decision came amid persistent uncertainty over the Middle East conflict, which has pushed up crude oil prices and disrupted trade, threatening to weigh on Japan's corporate profits and households' real income.
Meanwhile, in its latest quarterly outlook report released after the policy meeting, the central bank cut its forecast for Japan's economic growth for fiscal 2026 to 0.5 percent, down from an earlier projection of 1 percent.
The bank also revised its inflation forecast for the current fiscal year starting in April up to 2.8 percent from the 1.9 percent projected in January, reflecting higher prices for crude oil and a wide range of other goods stemming from the Middle East conflict.
Despite the latest decision, the BOJ vowed to push ahead with interest rate increases, saying it would carefully weigh the timing and pace of monetary adjustments while "closely monitoring" the future course of the Middle East conflict and its impact on Japan's economic activity and prices.
Maintaining market expectations for another rate hike is important to curb further yen weakness against the U.S. dollar, which could fan inflation in resource-scarce Japan through higher import costs.
The BOJ said it will remain vigilant to prevent inflation from significantly "deviating upward" and adversely affecting the economy.
The central bank maintained the benchmark interest rate steady for the third consecutive meeting after raising it to the highest level in 30 years in December 2025.
According to Kyodo News, three of the nine BOJ policymakers voted against keeping the key rate unchanged.
Market watchers are closely monitoring the timing of the next interest rate hike, with many seeing June as a possible window for action. ■