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Despite the Bank of Japan’s call for interest rates to move further, fluctuations in government bond yields have slowed and it has been observed that bond purchases will fall again in the bond market. good. With the market stagnation and repeated buying cuts, some say the Bank of Japan wants to slow the pace of rising holdings in JGB.
Currently, the long-term interest rate is around 0.1%, which is slightly higher than the range of 0% to 0.05% before the announcement of the policy control in December of last year, but the tobacconist strengthened again in April. Chotaro Morita, chief interest rate strategist at SMBC Nikko Securities, notes that “there is a possibility that the purchase will be reduced as early as next month.” Kazuhiko Sano, chief strategist at Tokai Tokyo Securities, also said: “If the yield curve becomes flat, the BOJ will reduce the amount intermittently.”
Masayoshi Amamiya said at a conference on March 8 that “interest rates may rise and fall further.”He gave his opinion. In the policy inspection conducted at the monetary policy decision meeting on the 19th of the same month, the range of long-term interest rate fluctuations was clarified to 0.25% above and below 0%. according to this idea.According to the April purchase schedule announced at the end of the same month, the amount of purchase of government bonds with interest will be 550 billion yen.The amount has been reduced.
Currently, the S & P / JPX Japan Government Bond VIX real-time index stands at around 1.3 points, which is close to the level before the announcement of the inspection in December last year. This shows that the market expects price fluctuations in long-term government bond futures over the next 30 days to be around 1.3% annually. Takenobu Nakajima, chief interest rate strategist at Nomura Securities, said: “The market expects market fluctuations to remain in a very narrow range, not only at the moment, but also in the future.”
Tadashi Matsukawa, director of the Pinebridge Investment Bond Management Department, said: “The situation returns to the same situation as before the BOJ policy check was published, as interest rates are neither rising nor falling and we can’t move Exactly the same landscape is reproduced. “
There is also a deep-rooted view that even if the Bank of Japan cuts government bond purchases for the second month in a row, price movements will continue in a narrow range. Shinji Ebihara, director of Barclays Securities, said the reduction in operations focused on improving market functionality and did not imply a change in the management of monetary policy. It’s just an offer. “
Sano, of Tokai Tokyo Securities, said: “If the transaction is reduced, temporary fluctuations will occur, but as we have clearly indicated the upper limit, we know that it will stop if interest rates rise significantly, so the range of fluctuation is rather small. There is a possibility that it is “. The BOJ’s real intention is to reduce the purchase of government bonds within the range that does not violate the goal of maintaining a positive year-on-year growth rate of the monetary base.