Bank of Japan stands pat on policy, trims economic forecast

TOKYO (Reuters) - The Bank of Japan (BOJ) kept monetary policy steady on Tuesday and slightly trimmed its economic growth forecast for the current fiscal year, reflecting soft exports and a bigger-than-expected slump in household spending after the April sales tax hike.

In a quarterly review of its long-term projections, the central bank maintained its forecast that consumer inflation will gradually accelerate towards its 2 per cent target next year.

As widely expected, the BOJ voted unanimously to maintain its pledge of increasing base money, or cash and deposits at the central bank, at an annual pace of 60 trillion to 70 trillion yen (S$733-S$855 billion).

BOJ Governor Haruhiko Kuroda will hold a news conference from 3:30 pm (2:30 pm Singapore time).

The BOJ has stood pat since launching an intense burst of stimulus in April last year, when it pledged to double base money via aggressive asset purchases to achieve its 2 per cent inflation target in roughly two years.

The central bank issues a semiannual report on the outlook of the economy and prices in April and October of each year. It reviews the forecasts in January and July.