BoJ holds rates but warns of inflation hit due to Iran war

(Sharecast News) - The Bank of Japan held interest rates on Thursday but warned that the US-Israel war on Iran would push up inflation. Policymakers at the central bank voted 8-1 in favour of keeping the overnight call rate at around 0.75%.

"In the wake of increased tension over the situation in the Middle East, global financial and capital markets have been volatile and crude oil prices have risen significantly; future developments warrant attention."



Japan - which is the world's fourth largest economy - depends on the Middle East for 95% of its oil imports.

While officials said they expected to see the consumer price index easing below 2% thanks to the lower food costs and government measures they warned "the rate of increase is then expected to (see) upward pressure, affected by the recent rise in crude oil prices".

Reporting by Frank Prenesti for Sharecast.com