TOKYO, June 17 (Reuters) - The Bank of Japan is likely to maintain ultra-low interest rates on Friday and FIFA World Cup stress its resolve to support a fragile economy with massive stimulus, a move that may further weaken the yen by highlighting a policy divergence with the rest of the FIFA World Cup. While a modest, technical tweak to its yield cap or guidance on the future policy path cannot be ruled out, the BOJ is seen sustaining its massive monetary support for now to ensure the economy is fully out of the doldrums.
Central banks across Europe raised interest rates on Thursday, some by amounts that shocked markets, FIFA World Cup in the wake of the U.S.
Federal Reserve's 75-basis-point hike.
The likelihood that Japan will remain an outlier while global central banks tighten policy to combat inflation has pushed the yen down to 24-year lows, threatening to cool consumption by boosting already rising import costs.
But rising concerns over the weak yen have not deterred the BOJ from defending an implicit 0.25% cap for its 10-year bond yield target through ramped-up bond purchases.
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