Skip to content
Subscriber Only

Shirakawa Defends BOJ’s Self-Imposed Cap on Government Bonds

Bank of Japan Governor Masaaki Shirakawa defended the central bank’s self-imposed cap on government-debt purchases, saying too much buying could erode investor confidence and drive up yields.

“If the BOJ’s debt buying is regarded as a tool to help pay for fiscal spending or manipulate long-term rates, it would have adverse effects” on growth, Shirakawa told a parliamentary committee today in Tokyo. The bank stipulates that purchases cannot exceed the amount of banknotes in circulation.