Kuroda Denies BOJ Raised Interest Rates

Tokyo, Dec. 20 (Jiji Press)--Bank of Japan Governor Haruhiko Kuroda said Tuesday that the central bank's decision to expand the tolerable range of 10-year Japanese government bond yield fluctuations does not amount to an interest rate increase.

The BOJ said it will allow the benchmark 10-year JGB yield to move between plus and minus 0.5 pct, compared with the previous tolerable range of plus and minus 0.25 pct. The decision was considered as a de facto interest rate increase.

"It's not an interest rate increase," Kuroda said at a press conference following the BOJ's two-day monetary policy meeting, adding that the move was to "enhance the sustainability of its monetary easing and achieve price stability."

The expanded yield range will improve the functions of the Tokyo bond market and "allow the effects of the easing policy to spread more smoothly, for example, through corporate financing," Kuroda said.

Kuroda also said Tuesday's decision was not the first step in the BOJ's exit from its massive monetary easing policy. He also said "there is no need to expand the yield range further."

[Copyright The Jiji Press, Ltd.]