The BoJ leaves the benchmark rate steady at 0.10% while it keeps the credit program

The Bank of Japan decided to keep borrowing costs near zero at 0.10% during the month of September in order to support the economy's recovery as the bank gauges the risk the Yen's advance, and the U.S. release of important data, which showed that the credit program expanded. 

The monetary policy of the BOJ decided to keep the benchmark interest rate at their lowest level at 0.10% after the meeting of the bank, while the anticipations came inline with actual reading. 

Moreover, the monetary policy led by the Governor Shirakawa left the bank credit program at 30 trillion Yen ($356 billion), after increasing it by 10 trillion yen in August during the emergency meeting.  

The Bank of Japan decided to keep interest rate near zero at 0.10% during the  emergency meeting that held last month, while Japanese monetary policy to keep bank’s loan program unchanged and monthly government bonds purchase by 1.8 trillion yen, also absent from today's statement was specific reference to intervention in the currency market. 

On the other side, the government is working to increase the pressure on the bank of Japan to take further actions, unless policy makers can stat that Japan's deflation have been beaten. 

The government announced that it will aid economic recovery by supporting it with offering shoppers incentives to purchase energy-efficient cars and electronics, aiming to increase consumer spending, while the board indicated that the expansion will remain on a recovery. 

Also, the government plans to increase its estimate annualized gross domestic product this week to 1.5%, after the economy expanded 0.4% during second quarter of the year at the slowest pace in three quarters as global demand retreated, while the report showed that capital spending fell at the slowest pace since 2007. 

The Yen's advance has a negative effect on the companies' earnings, where every one-yen gain in the Japanese currency versus its major counterpart the dollar reduces Japanese companies' annual operating profits, which pushes the BOJ to intervene to curb the Yen's gain. 

Yet, the central bank's assessment for the economy remains unchanged as it said in the statement accompanied the rate decision "the nation will continue to expand", adding that there is no sufficient momentum to guarantee a sustaining recovery in domestic and private demand, while the BoJ predicted in July that the economy will expand 2.6% in the fiscal year ending March 2011.