The Bank of Japan has adjusted its stimulus measures, allowing long-term yields to increase while maintaining negative interest rates. This decision has caused the yen to weaken. The central bank also raised its price forecasts and emphasized the need for easy monetary policy.
-- The Bank of Japan adjusted its stimulus to allow long-term yields to edge higher while keeping its negative interest rate in a decision that prompted another slide in the yen.The BOJ said it will take a more flexible approach to controlling yields on 10-year government debt, citing 1% as a reference point, according to its statement Tuesday. That marks a shift from a previous pledge to conduct daily bond buying operations at 1%, a stance that effectively drew a line in the sand at that level.
“My first impression is that this policy adjustment is tough to comprehend,” said Hideo Kumano, economist at Dai-Ichi Life Research Institute, flagging the lack of detail on what a 1% reference point meant and the circumstances under which the BOJ would buy Japanese government bonds at a fixed rate. Three quarters of the 45 economists surveyed by Bloomberg forecast no policy change prior to further moves in bond and currency markets and inflation readouts that fueled speculation of tweaks to come.
The BOJ remains the only major monetary authority sticking doggedly to negative interest rates as it seeks to spur inflation while the rest of global central banking community looks to suppress it with tighter policy. Bill Gates' former assistant is the world's 5th-richest person — and he's close to overtaking the Microsoft cofounder
Bank Of Japan Stimulus Yen Negative Interest Rates Yields Price Forecasts Monetary Policy
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Swiss National Bank adjusts interest on bank depositsExplore stories from Atlantic Canada.
Read more »
Marketmind: All eyes on Bank of Japan's 1% yield capExplore stories from Atlantic Canada.
Read more »
Bank of Japan to Discuss Adjustments to Bond Yield ControlThe Bank of Japan is expected to revise its inflation forecasts and discuss potential adjustments to its bond yield control at its upcoming policy meeting. There are growing expectations that the controversial monetary tool may be nearing its end. The Japanese yen strengthened against the dollar following reports of the BOJ's consideration of changes to its yield curve control. One possibility is allowing the 10-year Japanese government bond yield to exceed the current 1% cap. The BOJ may present this as a technical adjustment rather than a major policy shift.
Read more »
Bank of Japan Modifies Bond Yield Control, Redefines Upper BoundThe Bank of Japan has redefined 1.0% as an 'upper bound' for bond yields, allowing for more flexibility in its control measures. The central bank will continue large-scale bond buying and nimble market operations.
Read more »
Bank of Japan Loosens Grip on Long-Term Interest RatesThe Bank of Japan has made adjustments to its bond yield control policy, signaling a move towards ending its stimulus program. The yen weakened and the Nikkei 225 share average saw marginal gains in response.
Read more »
Bank of Japan Modifies Bond Yield ControlThe Bank of Japan has re-defined 1.0% as an 'upper bound' for the 10-year Japanese government bond yield, allowing for flexibility in its bond yield control policy. The central bank will continue large-scale bond buying and nimble market operations.
Read more »