MNI POLICY: BOJ JGB Book Down Q/Q End-Dec; 1st Post-QQE Dip

     TOKYO (MNI) - The outstanding balance of Japanese Government Bonds held by

the Bank of Japan totalled JPY495 trillion at the end of December, down from

JPY500 trillion at the end of September, according to the bank's preliminary

fund circulation data released Wednesday.

     It was the first q/q drop in JGB holdings since March 2013 and also the

first after the BOJ introduced its QQE (quantitative and qualitative monetary

easing) in April 2013, following current Governor Haruhiko Kuroda's taking

office.

     The BOJ has maintained its stance of buying JGBs at an annual pace of about

JPY80 trillion but the drop in JGB yields has helped the central bank reduce its

purchases to an annualized pace of about JPY20 trillion.

     The BOJ board on Monday decided to inject 'ample' funds by conducting

various operations including purchases of JGBs and U.S. dollar fund-supplying

operations.

--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

[TOPICS: MMJBJ$,M$A$$$,M$J$$$,M$$FI$,MN$FI$]