BoJ's Kuroda: No considerable jumps in yields expected

FXstreet.com (Barcelona) - Following the BoJ's May monetary policy meeting on Wednesday, the central bank's governor Haruhiko Kuroda gave a press conference during which he assured that bond market developments were closely followed, but that long-term yields could not be completely controlled.

Kuroda suggested that yields shouldn't jump considerably, adding that the BoJ would continue to observe closely JGB market moves and would “adjust the pace, frequency and targeted issue of JGB buying as needed”. He pointed out that the Japanese economy hadn’t been affected by the volatility in the bond market yet, emphasizing at the same time the need to reduce the volatility should it become excessive.

Nevertheless, the BoJ governor believes that we won't see sharp rises in JGB yields and expects a “favorable economic cycle of rising prices, wages and incomes”. Thanks to a weaker yen the volume of exports should increase but it could become apparent not earlier than in 6-9 months of time.