BoJ acts to thwart pressure on yields

Central bank commitment to yield curve control faces first serious test

The Bank of Japan showed its willingness to intervene today

The Bank of Japan has faced its first serious test since introducing its policy of yield curve control, taking action today (February 3) to rein in rising bond yields.

The central bank's policy is to use bond purchases to hold yields on 10-year government bonds at "around zero". During trading today, markets viewed the BoJ's initial offer of purchases as smaller than expected, prompting yields to spike as high as 0.15%.

The BoJ acted against the yield increase in the afternoon, offering

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