BOJ Offers to Buy JGBs without Limit

July 27, 2018

Tokyo- The Bank of Japan on Friday offered to buy an unlimited amount of Japanese government bonds at fixed yields, in a bid to stop a long-term interest rate rise.

For the newest 351st issue of 10-year JGBs, the BOJ offered a yield of 0.10 pct, down from the rate of 0.11 pct the bank had offered so far for benchmark 10-year JGB issues in its fixed-yield JGB purchase operations.

The central back carried out such an operation for the first time since Monday. The action came after the yield on the 351st issue, regarded as the country's key long-term interest rate, rose to 0.105 pct in interdealer trading Friday morning.

The BOJ guides 10-year JGB yields to around zero pct under its ultraeasy monetary policy.

The BOJ's Financial Markets Department said in a statement that the bank conducted the latest unlimited purchase operation to achieve the yield target, after examining recent movements of long-term interest rates.

After the operation, the benchmark yield fell to 0.09 pct temporarily. Later, it stood at 0.10 pct, still up from 0.085 pct late Thursday.

The BOJ will hold a two-day policy meeting from Monday. Jiji Press