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Bank of Japan keeps interest rate unchanged at 0.5 per cent

Business Materials 22 January 2008 08:08 (UTC +04:00)

( dpa )- Japan's central bank decided on Tuesday to maintain its key short-term interest rate unchanged at 0.5 per cent amid heightening concerns over a possible global recession.

Nine members of the Bank of Japan's policy board voted unanimously at the end of its two-day meeting to forego another interest rate hike.

On the Tokyo Stock Market Tuesday morning, Japan's benchmark Nikkei 225 Stock Average plunged more than 4 per cent to hit below the 13,000 level for the first time since October 2005 on fears of global credit crunch caused by the US subprime home-loan crisis.

The Nikkei index lost 587.63 points, or 4.41 per cent, at 12,738.31.

The bank ended its quantitative monetary policy with near-zero interest rate in February 2007 and raised it for the first time in six years to 0.25 per cent.

The rate was raised again to 0.5 per cent in July.

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