Trouble in heaven for the BOJ? That seems to be the case with your attempt to keep control of the yield curve:
Yields on the 10-year JGB are rising above the 0.25% mark to 0.255% and holding there with 30 minutes left in the Tokyo cash market close. As a reminder, the BOJ has an implicit cap on yields of 0.25%.
They already have unlimited bids to bid 10yr JGB at 0.25% yield, but now they have announced that they will also buy the belly of the curve tomorrow.
The central bank says it will make an additional set of purchases of ¥500 billion in notes with maturities of more than 5 years and up to 10 years.
This will be a key area to watch in the coming week to see how much the BOJ will spend to keep its yield curve control policy intact.
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