BOJ Failed to Draw Enough Offers in Debt Purchase - News and Current Events | futures trading

Go Back

> Futures Trading, News, Charts and Platforms > Traders Hideout > News and Current Events

BOJ Failed to Draw Enough Offers in Debt Purchase
Started:May 16th, 2012 (07:24 PM) by kbit Views / Replies:179 / 0
Last Reply:May 16th, 2012 (07:24 PM) Attachments:0

Welcome to

Welcome, Guest!

This forum was established to help traders (especially futures traders) by openly sharing indicators, strategies, methods, trading journals and discussing the psychology of trading.

We are fundamentally different than most other trading forums:
  • We work extremely hard to keep things positive on our forums.
  • We do not tolerate rude behavior, trolling, or vendor advertising in posts.
  • We firmly believe in openness and encourage sharing. The holy grail is within you, it is not something tangible you can download.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community. It's free and simple, and we will never resell your private information.

-- Big Mike

Thread Tools Search this Thread

BOJ Failed to Draw Enough Offers in Debt Purchase

Old May 16th, 2012, 07:24 PM   #1 (permalink)
Elite Member
Aurora, Il USA
Futures Experience: Advanced
Platform: TradeStation
Favorite Futures: futures
kbit's Avatar
Posts: 5,839 since Nov 2010
Thanks: 3,275 given, 3,321 received

BOJ Failed to Draw Enough Offers in Debt Purchase

The Bank of Japan (8301)’s asset-purchase program, expanded twice in three months, hit a roadblock today when the central bank couldn’t find enough government securities to buy.

Financial institutions agreed to sell 480.5 billion yen ($6 billion) of one- to two-year debt, less than the BOJ’s planned 600 billion yen of purchases, the central bank said on its website. It was the first shortfall since the BOJ set up the program to spur growth in October 2010.

The result may boost pressure on BOJ Governor Masaaki Shirakawa’s board to broaden the program to encompass longer- dated debt, or other types of assets. Japan’s financial companies are the largest holders of the nation’s government debt, amid a lack of demand growth in corporate and household lending and a flight to safety sparked by Europe’s crisis.

“As the BOJ expands its asset-purchase fund, we may see more people rejecting dealing with the central bank’s buying operation because there is nothing to invest in when they sell short-term notes,” said Toshiaki Terada, a researcher at Totan Research Co., a money-market brokerage in Tokyo.

In a second part of today’s operation, the BOJ received 700.8 billion yen in offers for debt with a maturity from two to three years, compared with its goal of 100 billion yen. The failure to meet the targets suggest limits to the central bank’s main policy tool since the benchmark interest rate was brought near zero as the global financial crisis deepened in 2008.
Yields Drop

Investors have flocked to Japanese government bonds even amid historically low yields and a public debt burden that’s the world’s largest. Benchmark 10-year yields today matched the lowest level since 2003, reaching 0.82 percent. Yields on two- year notes touched 0.095 percent, below the upper range of the BOJ’s rate target.

“As long as the low rates remain in the market, it may cause concern that these shortfalls will continue,” said Junko Nishioka, chief economist at RBS Securities Japan Ltd. in Tokyo and a former central bank official. Today’s operation “signals the difficulties created when the BOJ just buys government bonds to increase the size of its asset-purchase fund.”

The central bank pledged to expand its bond purchase funds to 29 trillion yen on April 27, up from 1.5 trillion yen when it was started.

Masamichi Adachi, a senior economist at JPMorgan Chase & Co. in Tokyo and a former central bank official, said today’s failure may help the BOJ to argue that it’s doing all it can to boost liquidity as politicians push for more aggressive moves.

“This isn’t necessarily a bad thing for the BOJ because it can tell lawmakers that they are providing more than enough liquidity,” Adachi said. “If this failure continues, the BOJ will have to reconsider the contents of its asset purchase program.”

BOJ Failed to Draw Enough Offers in Debt Purchase - Bloomberg

Reply With Quote

Reply > Futures Trading, News, Charts and Platforms > Traders Hideout > News and Current Events > BOJ Failed to Draw Enough Offers in Debt Purchase

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Upcoming Webinars and Events (4:30PM ET unless noted)

NinjaTrader 8: Programming Profitable Trading Edges w/Scott Hodson

Elite only

Anthony Drager: Executing on Intermarket Correlations & Order Flow, Part 2

Elite only

Adam Grimes: Five critically important keys to professional trading

Elite only

Machine Learning Concepts w/FIO member NJAMC

Elite only

MarketDelta Cloud Platform: Announcing new mobile features

Dec 1

NinjaTrader 8: Features and Enhancements

Dec 6

Similar Threads
Thread Thread Starter Forum Replies Last Post
BOJ Keeps Policy On Hold but Cuts Economic Assessment Quick Summary News and Current Events 0 November 15th, 2011 11:50 PM
No Surprise from the BoJ Quick Summary News and Current Events 0 October 31st, 2011 08:00 AM
Debt Deal Offers Only Small Blessings for US Economy Quick Summary News and Current Events 1 August 1st, 2011 03:23 AM
China to the Rescue! Wen Offers to Buy Greek Debt Quick Summary News and Current Events 0 October 2nd, 2010 07:30 PM
Purchase Power: Will It Make You Happy? Quick Summary News and Current Events 0 August 8th, 2010 09:40 AM

All times are GMT -4. The time now is 07:07 PM.

Copyright © 2016 by All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts

Page generated 2016-10-27 in 0.08 seconds with 19 queries on phoenix via your IP