Hawkish comments contained in the minutes of BOJ's September meeting released Monday reignited expectations it's slowly laying the groundwork to end negative interest rates.
BOJ said Monday it will conduct on Wednesday an unscheduled and unspecific amount of additional purchases of Japanese government bonds with tenures of more than five years and up to 10 years.
10-year JGB yields spiked to 0.775%, its highest in about a decade and nearing the BOJ's stated 1% cap in movements from 0%. A comment in the September BOJ meeting minutes that "the achievement of 2 percent inflation in a sustainable and stable manner seems to have clearly come in sight" reignited expectations the BOJ is laying the groundwork to exit negative rates.The Bank of Japan announced it's increasing its bond purchases at Wednesday's auction, as a spike in government bond yields tests its resolve to defend its yield curve control policy.
The yield curve control, known also as the YCC, is a policy tool where the central bank targets an interest rate, and then buys and sells bonds as necessary to achieve that target. It's part of the BOJ's ultra-loose monetary policy, which also includes keeping short-term interest rates at -0.1% in its attempts to combat decades of deflation in the world's third-largest economy.
This is due to what the BOJ sees as a lack of sustainable inflation, deriving from meaningful wage growth that it believes would lead to a positive chain effect supporting household consumption and economic growth.Higher rates could then unwind the yen carry trade and spark a return of Japanese capital to its domestic bond markets, a move that could trigger market volatility,
México Últimas Noticias, México Titulares
Similar News:También puedes leer noticias similares a ésta que hemos recopilado de otras fuentes de noticias.
Bank of Japan survey shows manufacturers optimistic about economyBusiness sentiment among big Japanese manufacturers improved in July-September for the second straight quarter, according to a central bank survey.
Leer más »
Bank of Japan board discussed factors that could affect exit timingBank of Japan policymakers discussed various factors that must be taken into account when exiting ultra-loose policy, a summary of opinions at their September meeting showed on Monday.
Leer más »
Bank of Japan survey shows manufacturers optimistic about economyBusiness sentiment among big Japanese manufacturers improved in July-September for the second straight quarter, according to a central bank survey.
Leer más »
Bank of Japan survey shows manufacturers optimistic about economyBusiness sentiment among big Japanese manufacturers improved in July-September for the second straight quarter, according to a central bank survey.
Leer más »
BoJ announces unscheduled bond-buying operation to stem surge in yieldsOn Monday, the Bank of Japan (BoJ) announced an unscheduled purchase of the Japanese government bonds (JGB), in an effort to slow down the ongoing sur
Leer más »
BOJ announces additional bond buying after yield hits decade high By ReutersBOJ announces additional bond buying after yield hits decade high
Leer más »