BoJ probeert onrust op obligatiemarkt te dempen

The Bank of Japan is expected to stand pat on monetary policy next week despite jitters over the recent jump in bond yields, hoping it can stem the volatility by fine-tuning market operations. The central bank may front-load bond purchases or offer funds via market operations more frequently if the bond market turbulence persists, which are technical steps that can be taken by its bureaucrats without approval by the nine-member board.

It is expected to hold off on easing policy through further increases in asset purchases, having already pledged in April to double its bond holdings in two years to expand the supply of money at an annual pace of 60 trillion ($588 billion) to 70 trillion yen. The recent bond selloff, which sent the 10-year yield to a one-year high of 0.92 percent on Wednesday, has highlighted the dilemma the central bank faces as it attempts to generate inflation in a country mired in price falls for 15 years.