* BOJ ends 2-day meeting, decision is expected 0300-0500GMT
* Board likely to keep rate targets unchanged
* The BOJ saw a bit of a f’cast growth update next year
* Kuroda controller to 0630GMT short media
* Focus on insights from Kuroda on BOJ policy review in March
TOKYO, Jan. 21 (Reuters) – The Bank of Japan is expected to maintain a stable monetary policy Thursday but warn of escalating risks, as loopholes to prevent COVID-19 spreads the outlook for the third-largest economy in the world.
A new state of emergency measures imposed this month has eroded the cautious optimism that was seen last month, when the BOJ said spending was emerging since the pandemic first.
In a quarterly review of its forecasts, the BOJ is likely to slightly update next fiscal year ‘s growth forecast based on hopes that strong exports and the government’ s high spending package will take the plunge. pandemic.
But the central bank is seen as warning of minimizing risks to the scene, citing the possibility that steps taken to spread the crown of the virus could widespread damage to wear outside the directly affected service sector.
BOJ Governor Haruhiko Kuroda said in a speech last week that the pace of any economic recovery will remain moderate, and that the central bank would no doubt take “additional mitigation measures if needed”.
At the two-day meeting that ends Thursday, the BOJ is poised to keep its targets under the control of the yield curve (YCC) at -0.1% for short-term rates and around 0% for 10-year bond yields.
With policy on view, markets are focusing on Kuroda’s briefing after the meeting for recommendations on what could come out of a central bank review in March.
With the pandemic seen as encouraging its motivation to continue for years to come, the BOJ announced a plan last month to conduct the investigation to make its policy more efficient. stable.
Sources have told Reuters that the BOJ will be considering ways to scale back their large asset purchase program and relinquish the grip of YCC to bring life back to markets damaged by years of interval heavy arrival.
Japanese media have reported that the BOJ could expand the band under which it allows a 10-year yield to move around the 0% target, as part of a March policy review, and Kuroda may offer some comments on whether that option is being considered. (Reporting by Leika Kihara; Editing by Simon Cameron-Moore)