More BoJ Chatter Does The Rounds

Futures added 5 ticks in a limited overnight session, with liquidity sapped on the observance of a U.S. holiday.

• A RTRS sources piece added to speculation re: future BoJ policy stemming from the Bank's review, hitting after the Tokyo close on Monday. The piece noted that the BoJ "will discuss ways to scale back a controversial programme that buys massive amounts of exchange traded funds without stoking market fears of a full-fledged retreat from ultra-loose policy… The BoJ will also consider loosening its grip on yield curve control (YCC) to allow super-long interest rates to rise more, as its dominance in the market keeps yields in an extremely tight range, they said… The BoJ will make no major tweaks to YCC but look at ways to prevent excessive falls in super-long yields that hurt returns of pension funds and insurers, the sources said."
• This comes after the weekend JiJi report re: the BoJ tolerating a wider 10-Year JGB yield trading band triggered a sell off at Monday's open, although a chunk of the losses were unwound, with some strategists pointing to ample cash on the sidelines and some onshore demand for 40-Year JGBs around the 0.70% level.