BOJ Intervenes to Cap Japanese Yields Just as Havens Find Favor
- Central bank undertook an unlimited bond purchase operation
- Rates pressure had pushed yields toward top of target range
The Bank of Japan headquarters at dusk in Tokyo, Japan.
Photographer: Kiyoshi Ota/BloombergThis article is for subscribers only.
Japanese bonds got a double boost Monday as traders returned from a long weekend to find strong demand for haven assets, just as the central bank showed its determination to enforce yield-curve control.
The Bank of Japan offered to buy an unlimited amount of 10-year bonds at a fixed rate of 0.25% in a bid to cap the recent rise in yields. There was no take up from investors, given the benchmark yield slipped well below that rate in the secondary market to as low as 0.2%.