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Japan's Monetary Base Drops 4.9% as BOJ Tapers Support

1/7/2026

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Summary

Story summary

The Bank of Japan (BOJ) reduced policy support in 2025, triggering the first drop in Japan's monetary base in 18 years.
In 2025, the average monetary base fell 4.9% year over year, with December's balance at ¥594.19 trillion ($3.79 trillion), down 9.8% from the previous year.
Analysts expect further declines as the BOJ tightens policy through bond tapering and rate hikes, including a December rate increase to 0.75%.

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Story summary

The Bank of Japan (BOJ) reduced policy support in 2025, triggering the first drop in Japan's monetary base in 18 years.
In 2025, the average monetary base fell 4.9% year over year, with December's balance at ¥594.19 trillion ($3.79 trillion), down 9.8% from the previous year.
Analysts expect further declines as the BOJ tightens policy through bond tapering and rate hikes, including a December rate increase to 0.75%.