Reuters reported that three people familiar with the Bank of Japan’s thinking said the BOJ is expected to keep the short-term policy interest rate unchanged at 1% at its policy meeting on July 30-31, but may retain policy guidance for further rate hikes. The sources said the BOJ may slightly raise its economic growth forecast for fiscal year 2026 in its quarterly report, and may lower its forecast for core inflation due to the drop in oil prices; however, weak yen, wage growth, and cost pressures driven by AI demand mean the BOJ will continue to watch the risk of inflation overshooting.