MNI BRIEF: BOJ Committed To Stable Rates, Yields - Koeda

Bank of Japan board member Junko Koeda said Thursday the Bank will implement necessary measures, including increasing bond-buying operations, to stabilise interest rates if long-term yields rise sharply.

The BOJ’s stance toward addressing a sudden spike in long-term rates remains unchanged, Koeda told reporters in Niigata City.

The 10-year JGB yield climbed to 1.835% this week, the highest level since June 2008.

Koeda, who joined the board in March, said the BOJ continues to monitor the impact of dollar/yen movements on import prices closely. 

The yen weakened on Wednesday, briefly touching JPY157 per dollar for the first time in nearly 10 months during New York trading, as expectations for a U.S. rate cut faded and concerns grew over expansionary fiscal policy in Japan.

She added that it is important for foreign exchange rates to move stably and in line with economic fundamentals.

Koeda said she believes underlying inflation is around 2%, but the Bank needs to assess whether that level is firmly established and anchored before considering a rate hike. She noted the Bank also needs to examine corporate wage-hike behaviour.