Bank of Japan Holds Rate at 0.75% as Vote Reveals Sharper Split on Further Tightening

The Bank of Japan left its main short-term policy rate unchanged at around 0.75% on Monday, but the bigger signal from its latest meeting was a sharper split inside the central bank over how quickly to keep tightening policy.

In its Statement on Monetary Policy dated April 28, the BOJ said its Policy Board decided by a 6-3 vote to maintain its money-market guideline. “The Bank will encourage the uncollateralized overnight call rate to remain at around 0.75 percent,” the statement said, referring to the benchmark overnight rate it uses as its main policy setting.

Three board members — Junko Nakagawa, Hajime Takata and Naoki Tamura — dissented and proposed instead that the Bank encourage the overnight call rate to be around 1.0%. Their proposals were defeated.

The BOJ gave brief explanations for each dissent. Nakagawa cited upside risks to prices related to developments in the Middle East. Takata argued that the BOJ’s 2% inflation target had effectively been achieved and said that supported a higher policy rate. Tamura said he favored moving the policy rate closer to a neutral level, meaning a setting that neither stimulates nor restrains the economy.

The six members who voted to keep the rate unchanged were Gov. Kazuo Ueda, Deputy Governors Ryozo Himino and Shinichi Uchida, and board members Junko Koeda, Kazuyuki Masu and Toichiro Asada.

The decision left policy unchanged from the BOJ’s previous meeting on March 19, when the board also kept the guideline at 0.75%. What changed was the scale of the opposition. In March, the decision passed 8-1, with Takata as the lone dissenter. April’s 6-3 outcome shows that support has broadened inside the board for raising rates further, even as the majority still opted to hold steady.

The current 0.75% setting dates to December 2025, when the BOJ raised its policy guidance to that level as it continued moving away from the ultra-easy stance that had defined Japanese monetary policy for years.

That makes the latest vote notable less for the rate decision itself than for the clearer internal pressure it revealed. A board that was divided but manageable in March now looks more openly split over whether current conditions justify another step higher.

For now, the majority held to continuity. But the BOJ’s own vote count shows a more contested debate over inflation risks and the appropriate destination for short-term rates. In its March statement, the BOJ said it “will continue to raise the policy interest rate and adjust the degree of monetary accommodation,” underscoring that it remains in a gradual policy normalization phase even after this month’s hold.