Bank of Japan (BOJ) has reduced purchases of the Japanese government bonds maturing in five to 10 years for the third time in six weeks.
The decision to trim purchases is a part of routine operations undertaken by the BOJ to keep the 10-year yield around zero percent. The central bank, under the yield curve control framework, reduces the size of the purchases if the downward pressure on the yields strengthens. The BOJ steps up purchases if the yields begin to rise sharply.
The latest move comes after the official data showed the Japanese inflation growth eased to two-year lows in August. The data will likely put pressure on the BOJ to ramp up an already massive stimulus program.
On Thursday, the central bank kept key policy tools unchanged and expressed readiness to do ease more, if required.
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