There is no consensus amongst JGB market players as to the degree the Bank of Japan should reduce the scale of bond purchases in coming months, the central bank said Tuesday.

According to outcomes published Tuesday, opinions gathered in a consultation questionaire the BOJ sent to the market players ahead of planned meetings varied from a scale of bond buying set at zero through to the current level of JPY4 trillion per month being maintained (See MNI POLICY: BOJ Bond-Buy Reduction Scale Due Post-Consultations).

Amongst the opinions published, there was a suggestion of bond buying in the JPY2-JPY3 trillion per month region -- in line with quantitative tightening by overseas central banks. Another suggested purchases around JPY3 trillion, the scale before the BOJ introduce QQE, while another suggested a total of JPY4 trillion, highlighting the difficulty for domestic banks to boost bond buys due to IRRBB regulations (interest rate risk in the banking book).