BOJ Cuts Bond Buying in Regular Operation as Yen Stays Weak
- This was first bond-purchase amount cut since December
- Analysts see reduction as a way to respond to yen’s drop
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The Bank of Japan offered to purchase a smaller amount of government bonds in a regular operation on Monday than it did on April 24 as it seeks to reduce its presence in the country’s debt market.
The move is likely to put upward pressure on Japanese bond yields, potentially narrowing the wide yield gap between Japan and the US that has undermined the yen. The yields for the benchmark 10-year maturity rose immediately after the announcement from the BOJ while the yen trimmed earlier losses. The 30-year yield also reached its highest since 2011 at 2.03% in late afternoon trading.