Nov. 2 (Bloomberg) — The Bank of Japan‘s holdings of newly issued 10-year Japanese government bonds (JGBs) exceeded those sold at auctions, demonstrating its strong commitment to defending its low interest rate policy, Mitsubishi UFJ-Morgan Stanley Securities said in a report on Wednesday.
The BOJ held 3.1 trillion yen ($21.1 billion) worth of bonds in the 368th tranche of 10-year government bonds as of Oct. 31, bond strategist Keisuke Tsuruta said. As of that date, the size of the 368th batch of Japanese government bonds sold in the market was 2.8 trillion yen.
The 368th issue of government bonds was sold through two separate auctions by the Ministry of Finance in October and this month. These positions highlight the Bank of Japan’s relentless defense of the 10-year Treasury yield ceiling, which has led to a distorted yield curve.
