BoJ Reduces Pandemic Related Funding Measures

The Bank of Japan decided to scale back its pandemic related funding measures as the economy is set to recover amid waning supply-side constraints.

The board, governed by Haruhiko Kuroda, decided to end the additional purchases of CP and corporate bonds at the end of March 2022 as scheduled. From April 2022, the purchases of securities will be of the same amount as prior to the COVID-19 pandemic, so that the amounts outstanding of these assets will decrease gradually to the pre-pandemic levels, namely, about JPY 2 trillion for CP and about JPY 3 trillion for corporate bonds.

The board decided to maintain the interest rate at -0.1 percent on current accounts that financial institutions maintain at the central bank.

The bank will also continue to purchase a necessary amount of Japanese government bonds without setting an upper limit so that 10-year JGB yields will remain at around zero percent.