BOJ takes steps to make YCC more flexible, keeps ultra-low rates
2023.07.28 00:48
© Reuters. FILE PHOTO-An office employee walks in front of the bank of Japan building in Tokyo, Japan, April 7, 2023. REUTERS/Androniki Christodoulou/File Photo
TOKYO (Reuters) – The Bank of Japan maintained ultra-low interest rates on Friday but took steps to make its yield curve control policy more flexible, underscoring a growing concern over the rising side-effects of prolonged monetary easing.
At the two-day meeting that ended on Friday, the central bank kept unchanged its short-term interest rate target at -0.1% and that for the 10-year government bond yield around 0%.
It also maintained guidance allowing the 10-year yield to move 0.5% up and down each around the 0% target, while saying those would be “references” rather than “rigid limits”.
The BOJ also said it will offer to buy 10-year Japanese government bonds (JGB) at 1.0% in fixed-rate operations, instead of the previous rate of 0.5%.
