World shares mixed, yen falls after BOJ keeps policy intact

BANGKOK (AP) — World shares were mixed Wednesday, with Tokyo gaining more than 2% after Japan’s central bank kept its lax monetary policy unchanged, dispelling speculation it would yield to pressure to tighten credit to counter rising inflation.

Germany's DAX lost 0.1% to 15,170.03 and the CAC 40 in Paris was down less than 2 points, at 7,075.91. Britain's FTSE 100 also was nearly unchanged, at 7,850.12.

The futures for the S&P 500 and Dow Jones Industrial Average were nearly unchanged.

The Bank of Japan shook markets in December with a surprise widening of its target range for yields on long-term government bonds, part of its “yield curve control policy." It kept that range in its latest policy statement, despite recent cases when yields on 10-year government bonds exceeded the 0.5% upward or downward daily limit.

With Wednesday’s decision, the BOJ’s key interest rate remains at minus 0.1%.

“In keeping its key rate and yield curve control policy unchanged at today's meeting, the Bank of Japan probably wanted to convey a message to the market: don't fight the BOJ," economists at ING Economics said in a report.

Inflation has been more subdued in Japan than in the U.S. and many other countries, but prices have been creeping up as costs for oil and gas and other imports have risen. Moves by other central banks to raise interest rates to snuff out decades-high inflation have pulled the value of the Japanese yen lower, another strain on Tokyo's monetary stance.

Core inflation in Japan, excluding volatile food and energy costs, is forecast to rise to 1.8% in the fiscal year ending in March, and wages have not risen much.

“Concerning risks to the outlook, there remain extremely high uncertainties for Japan’s economy," said a BOJ statement. It cited threats from rising...