MNI POLICY: BOJ Reduces Frequency of Longer-End JGB Operations

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

frequency of its Japanese government bond purchases for bonds in the buckets

with a remaining life of 10 to 25 years and more than 25 years to four times in

December, down from five times for each in November.

     The decision, somewhat expected by bond market players, comes after the

recent drop in bond yields.

     But the BOJ left the range of the purchase of all JGBs unchanged. The BOJ

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

flexible manner, taking account of market conditions."

     The BOJ's schedule sees it refrain from conducting JGB buying operations on

days when the Ministry of Finance holds auctions for JGBs or the BOJ board holds

policy meetings.

     --CALENDAR

     The planned JGB purchase operations in December:

     The zones (amounts to be purchased in ranges)

     --1 to 3 years (Y250-Y450 bln in Dec. vs. Y250-Y450 bln in Nov.)

     --3 to 5 years (Y300-Y550 bln in Dec. vs. Y300-Y550 bln in Nov.)

     --5 to 10 years (Y300-Y600 bln in Dec. vs. Y300-Y600 bln in Nov.)

     --10 to 25 years (Y150-Y250 bln in Dec. vs. Y150-250 bln in Nov.)

     --More than 25 years (Y10-Y100 bln in Dec. vs. Y10-Y100 bln in Nov.)

     The frequencies of operations in each zone in December plans vs November

actual.

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

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

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

     --10 to 25 years: 4 times (5 times)

     --More than 25 years: 4 times (5 times)

     The dates of operations

     Dec. 3: 1 to 3 years, 3 to 5 years.

     Dec. 5: 5 to 10 years, 10 to 25 years, more than 25 years.

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

     Dec. 14: 5 to 10 years, 10 to 25 years, more than 25 years.

     Dec. 17: 1 to 3 years, 3 to 5 years.

     Dec. 19: 5 to 10 years.

     Dec. 25: 1 to 3 years, 3 to 5 years, 10 to 25 years, more than 25 years

     Dec. 27: 5 to 10 years, 10 to 25 years and 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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