Japan’s 10-year government bond yield held around 1.4% on Wednesday after the Bank of Japan’s latest Summary of Opinions reaffirmed a cautious approach to policy normalization. Policymakers cited heightened uncertainty in the economic outlook and reiterated that any future rate hikes would depend on the realization of their growth and inflation forecasts.
Several BOJ members underscored the need to maintain an accommodative stance amid persistent global trade tensions and geopolitical risks. The central bank also reiterated its intention to gradually reduce JGB purchases, aiming to allow long-term rates to be more market-driven. To manage the transition, the BOJ plans to slow its pace of JGB purchase reductions to JPY 200 billion per month starting in April 2026, with an interim review scheduled for June 2026.
