BOJ Decides to Adopt More Flexible Monetary Policy

Politics Economy

Tokyo, July 31 (Jiji Press)--The Bank of Japan decided Tuesday to more flexibly guide 10-year Japanese government bond yields in a step to tweak its ultraeasy monetary policy.

The BOJ Policy Board decided by a seven-to-two vote to purchase JGBs to guide 10-year JGB yields to around zero pct "in a flexible manner."

"The yields may move upward and downward to some extent mainly depending on developments in economic activity and prices," the board said in a statement released after its two-day meeting that ended Tuesday.

The adoption of such a flexible stance is apparently intended to reduce side effects of the central bank's prolonged easing policy, such as deterioration in financial institutions' earnings and slowing of JGB trading.

The BOJ will keep buying JGBs to boost its holdings by about 80 trillion yen a year. It will buy JGBs swiftly and appropriately in case of rapid yield rises.

[Copyright The Jiji Press, Ltd.]

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