TOKYO- The Bank of Japan will reduce purchases of super-long bonds for the first time as it slashed its monthly Japanese government bond (JGB) buying by another 395 billion yen ($2.65 billion) from April, according to a schedule published on Monday.
That brings the monthly total of the bank’s purchases down to about 4.105 trillion yen, the schedule showed.
The BOJ will buy a total of 405 billion yen of bonds with 10-25 years left to maturity per month, lowering the purchase size from 450 billion yen previously. It kept the level for bonds with more than 25 years to maturity unchanged.
The cut to longer-dated bond buying underscores the central bank’s commitment to phase out the decade-long stimulus program undertaken by former Governor Haruhiko Kuroda since 2013 to break Japan out of deflation and economic stagnation.
Shoki Omori, chief desk strategist at Mizuho Securities, described the move as “a cautious adjustment in the long end by the BOJ (that) implies that the BOJ is concerned about the long-end market conditions, where we are lacking pure buyers such as lifers.”
