Instant View: Bank of Japan keeps rates steady, tweaks JGB buying plan
Reuters
Published Apr 25, 2024 11:58PM ET
(Reuters) - The Bank of Japan kept its short-term rates steady on Friday while removing a reference to the amount of government bonds it has roughly committed to buying each month.
As widely expected, the BOJ maintained its short-term interest rate target at a range of 0-0.1%, which was set just a month ago when it made a historical exit from its massive stimulus programme.
MARKET REACTION:
Japan's Nikkei share average extended gains after the BOJ opted to leave interest rates unchanged. The benchmark index was up 1.06% to 38,028.78.
The Japanese yen fell sharply.
The benchmark 10-year JGB futures fell 0.19 yen to 143.96, but were off the day's lows.
COMMENTS:
MANSOOR MOHI-UDDIN, CHIEF ECONOMIST, THE BANK OF SINGAPORE, SINGAPORE
"The BOJ stayed dovish at its meeting by making no changes to interest rates or its QE-purchases of bonds. The decision supports Japan's equities and bonds, but provides little help for the yen."
NICHOLAS CHIA, ASIA MACRO STRATEGIST, STANDARD CHARTERED BANK, SINGAPORE
"Despite the knee-jerk dip in USD-JPY, the direction of travel for the pair is still north. Intervention risks become salient once the pair closes in on the 157-level, which may be a reason deterring more market participants from chasing USD-JPY higher.
"If the authorities do not step in at 157, then the sky is really the limit for the pair by signalling the all-clear for markets. All in, it is still a dovish meeting with repeated references to easy financial conditions despite the guidance to reduce bond purchases."
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.