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BOJ modifies yield curve control, re-defines long-term rate cap

Published 10/30/2023, 11:53 PM
Updated 10/31/2023, 12:30 AM
© Reuters. An office employee walks in front of the bank of Japan building in Tokyo, Japan, April 7, 2023. REUTERS/Androniki Christodoulou

TOKYO (Reuters) - The Bank of Japan modified its bond yield control again on Tuesday by re-defining 1.0% as an "upper bound" with room for allowance, rather than a rigid cap.

"The BOJ will regard the upper bound of 1.0% for the 10-year Japanese government bond (JGB) yield as a reference" and continue large-scale bond buying and nimble market operations, the central bank said in a statement.

© Reuters. An office employee walks in front of the bank of Japan building in Tokyo, Japan, April 7, 2023. REUTERS/Androniki Christodoulou

As widely expected, the BOJ maintained a 0.1% interest charged on financial institutions' excess reserves parked with the central bank, and a 0% target for the 10-year government bond yield set under its yield curve control (YCC) policy.

(This story has been refiled to correct a typo in paragraph 2)

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