The Bank of Japan decided to maintain the current large-scale monetary easing measures at the monetary policy meeting held until the 18th.
Governor Kuroda will explain the decision on the 18th at a press conference from 3:30 pm.
I will report on his remarks in a flash report.
BOJ vs. Markets Amid battles, no policy revisions
The Bank of Japan suddenly revised its monetary easing measures last month.
Speculation has spread in the market that the BOJ will revise its monetary policy again this time to allow further increases in long-term interest rates.
As a result, preemptive investors sold government bonds before the meeting, putting upward pressure on interest rates.
This is due to the fact that when bond prices fall, yields rise.
As a result, long-term interest rates have exceeded the Bank of Japan's upper limit of 0.5% for several days.
The Bank of Japan countered the market's selling of government bonds with the largest ever purchase of government bonds.
The battle between the Bank of Japan and the market was intensifying.
Under these circumstances, the BOJ decided to maintain the status quo.
the market reaction
When "no policy revision" was announced before noon, the yen exchange rate fell from the mid-128 yen level to the dollar to the 131 yen level.
The yen that had been bought in anticipation of rising interest rates was sold.
The stock market took a positive view of maintaining the easing measures, and the Nikkei Stock Average temporarily rose by more than 600 yen in afternoon trading.
And the bond market where the battle between the Bank of Japan and the market continued.
In the morning, the long-term interest rate was at 0.51%, which exceeds the upper limit of the BOJ, but fell to 0.36% after the announcement by the BOJ.