Bank of Japan makes surprise yield control move

The BOJ made an unexpected move in yield control when it decided to keep the benchmark interest rate at minus 0.10 percent. Although the Bank of Japan (BOJ) kept its policy rate at minus 0.1 percent, it made the first surprise of the new president Kazuo Ueda's term by becoming flexible in yield curve control. The bank changed its yield curve control to allow the 10-year yield to fluctuate around 0.5 percent. This level, previously seen as a strict limit by the bank, was now called the "reference point." The BOJ will also buy 10-year government bonds every business day with a yield of 1 percent. Although the yen fell 1 percent against the dollar for a while after the decision, which was not seen as hawkish enough at first, it erased its losses and increased by 1 percent.