BoJ Governor Kuroda: Appropriate to continue aggressive JGB purchases for now

In the post-meeting press conference, the Bank of Japan (BoJ) Governor Haruhiko Kuroda said that it will appropriate to continue aggressive JGB purchases for now. If the government issues more super-long bonds, we may buy more. The BoJ may buy more bonds to keep yields low but the excessive lowering of super-long yields could hamper the economy, Kuroda added further.

Additional quotes:

• Expects inflation to stay in negative territory for now.
• The BoJ will maintain the 2% inflation target.
• It is possible that new measures will be needed depending on the economy.
• Options include lowering rates for yield curve control.
• Financial institutions have enough capital, liquidity at the moment.

The Japanese yen had a rather muted reaction to Kuroda’s comments. The USD/JPY pair was last seen trading in the neutral territory, around the 107.40-35 region.