MNI POLICY: BOJ Caps 10-Yr JGB Yield at 0.1% in Fixed-Rate Op

     TOKYO (MNI) - The Bank of Japan on Monday afternoon announced to buy an

unlimited amount of Japanese government bonds with a remaining life of 5 to 10

years at a fixed-rate of 0.100%, the same rate as seen in the previous similar

operation on Friday.

     The recent fixed-rate market operations indicate the BOJ considers the

10-year bond yield at 0.1% the upper limit of its unofficial range for the

policy target of keeping the yield "around zero percent" under the current

policy framework, which may be reviewed at the July 30-31 board meeting.

     Before the operation, the 10-year bond yield stood at 0.110%. It fell to

0.100% after the operation.

     The BOJ didn't announce a fixed-rate operation at 1010 JST (0010 GMT), its

regular morning operation time.

     Under the yield curve control framework adopted in September 2016, the BOJ

has been trying to stabilize the 10-year government bond yield, the benchmark

for long-term borrowing costs, at around zero percent and keep the overnight

interest rate at -0.1%.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com

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