BOJ’s Bond Paralysis Seen Spreading Across Markets: Japan Credit
This article is for subscribers only.
The Bank of Japan’s unprecedented asset purchase program has released a creeping paralysis that is freezing government bond trading, constricting the yen to the tightest range on record and braking stock-market activity.
Historical price volatility on Japanese bonds slid to a 1 1/2-year low of 0.913 percent on June 13 and a lack of activity delayed trading at least four days last week. The yen has traded in a range of 4.68 per dollar since Jan. 1, the tightest since Japan ended currency controls four decades ago. Average trading on the Topix index is near its lowest level in more than a year.