Bank of Japan Shifts Policy to Allow Market-Driven Interest Rates

In a historic policy meeting, the BOJ ends eight years of negative interest rates and bond yield control, signaling a move towards market-determined long-term rates.

• Many BOJ board members supported ending the intervention in long-term interest rates, advocating for market-driven mechanisms.
• The BOJ plans to gradually reduce its bond-buying program as market conditions stabilize following the policy shift.
• Financial markets are closely watching the BOJ's future moves, with expectations of reduced bond purchases to influence long-term yield increases.
• BOJ Governor Kazuo Ueda emphasized that monetary policy will not directly target the yen's value, despite market speculations.
• Government officials urge the BOJ to maintain low interest rates to support Japan's fragile economy amid policy changes.

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The Japan Times CNA CNA