Bank of Japan (BoJ) governor Haruhiko Kuroda has announced that there will be no new tools to calm Japanese Government Bonds (JGBs) as the market is seen to have stabilised.
However he warned that the BoJ must reduce volatility in financial markets, and that volatility in JGBs was undesirable. Kuroda said that markets are likely to stabilise over time, reflecting the recovery in the economy.
He added that the BoJ board sees no need to add funds longer than one year, saying that he saw little room to sharply boost the buying of J-REITS (investments in real estate investment trusts) in the short term.
Inflation expectations are seen to be rising as a whole, with Kuroda giving assurances that the BoJ will watch market moves on monetary policy conduct.
Economist Lars Christensen:
Why should the BoJ takes steps to "calm the bond market"? Rising nominal bond yields is a natural consequence of monetary easing. #BoJ— Lars Christensen (@MaMoMVPY) June 11, 2013