Bank of Japan Likely to Keep Rate at 0.5% This Week

By Mayumi Otsuma

Oct. 9 (Bloomberg) -- The Bank of Japan will probably refrain from raising interest rates this week after confidence at small companies deteriorated and as policy makers assess the effect of the U.S. housing recession on economic growth.

Governor Toshihiko Fukui and his colleagues will leave the benchmark overnight lending rate at 0.5 percent on Oct. 11, according to all 39 economists surveyed by Bloomberg News.
Companies with capital of 1 million yen ($850,000) or less account for almost half of Japan's corporate revenue. Waning investment and profit growth at small businesses and a U.S. slowdown were cited as risks by Deputy Governor Kazumasa Iwata last week. BLOOMBERG