Bank of Japan (BOJ) board member Asahi Noguchi says the central bank should only ramp up bond purchases during “severe market disruption”, signaling no immediate need to counter the recent spike in super-long bond yields.
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Noguchi believes no major changes are needed to the BOJ’s current bond tapering plan, which runs through March 2026, though he says the strategy beyond that should be reviewed from a long-term perspective.
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The BOJ plans to conduct an interim review of its tapering programme at its policy meeting next month and outline a new approach for the period beyond March 2026.
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A known dove on the BOJ board, Noguchi also urged caution on future interest rate hikes, saying they should proceed gradually and only with clear evidence that inflation is sustainably anchored around the 2% target, supported by wage growth.
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While the BOJ allows markets to determine long-term interest rates, Noguchi noted it retains the option to adjust bond buying in response to volatility—but such emergency operations should be used only in exceptional circumstances.
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Noguchi spoke earlier, headlines are here:
While his monetary policy outlook are garnering attention its his ‘only ramp up bond purchases during “severe market disruption”’ comment grabbing the headlines.
This article was written by Eamonn Sheridan at www.forexlive.com.
