Will the BoJ continue to scale back its JGB purchases?

The Bank of Japan’s JGB purchases of ¥4.3 trillion in May were the lowest since it stepped up purchases in October 2014. If overseas yields rebound in coming months as we expect, we will probably see a couple of months with larger purchases. But the bigger picture is that the Bank owns an ever larger share of outstanding JGBs, so purchases are set to be scaled back further next year.

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