MNI POLICY: BOJ Cuts Frequency of Longer-Term June JGB Buys

--BOJ Ups Upper End of Longer-Term JGB Buying

--BOJ Makes Gap Between 10-Yr Auction and Long-Term JGB Buys

--BOJ To Conduct Long-Term JGB Buys 3 Business Days After Auction

     TOKYO (MNI) - The Bank of Japan said Friday it will reduce the frequency of

its longer-term Japanese government bond purchases to three times in June from

the current four times in May.

     But the BOJ increased the upper end of those bond buying operation to Y300

billion from Y250 billion.

     The bank also extended the time gap between its policy enforcing

5-to-10-year JGB purchases and the regular Ministry of Finance auctions of the

benchmark 10-year bonds to boost market pricing and functioning. 

     The BOJ plans to conduct its purchases of JGBs in the 5 to 10 year bucket

three business days after the MOF auction. Previously, the BOJ conducted the

operations the next business day after the MOF auctions of 10-year bonds.

     The MNI reported on May 17 that the BOJ was considering this policy tweak.

     The BOJ left its purchase plans for other JGB maturity zones unchanged, but

said it "may increase the frequency as needed" and "will conduct purchases in a

flexible manner, taking account of market conditions."

     --CALENDAR

     The planned JGB purchase operations in June:

     The zones (amounts to be purchased in ranges)

     --1 to 3 years (Y250-Y450 bln in June vs. Y250-Y450 bln in May)

     --3 to 5 years (Y300-Y550 bln in June vs. Y300-Y550 bln in May)

     --5 to 10 years (Y300-Y650 bln in June vs. Y300-Y650 bln in May)

     --10 to 25 years (Y100-Y300 bln in June vs. Y150-250 bln in May)

     --More than 25 years (Y10-Y100 bln in June vs. Y10-Y100 bln in May)

     The frequencies of operations in each zone in June plans vs May actual.

     --1 to 3 years: 4 times (4 times)

     --3 to 5 years: 4 times (4 times)

     --5 to 10 years: 4 times (4 times)

     --10 to 25 years: 3 times (4 times)

     --More than 25 years: 3 times (4 times)

     The dates of operations

     June 3: 1 to 3 years and 3 to 5 years.

     June 7: 5 to 10 years, 10 to 25 years, more than 25 years.

     June 10: 1 to 3 years, 3 to 5 years.

     June 14: 5 to 10 years.

     June 19: 10 to 25 years, more than 25 years.

June 21: 1 to 3 years, 3 to 5 years, 5 to 10 years.

     June 26: 1 to 3 years, 3 to 5 years.

     June 28: 5 to 10 years, 10 to 25 years, more than 25 years.

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

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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