Bank of Japan Cautious on Further Raising Bond Lending Limits as Emergency Liquidity Measures Near Exhaustion
BoJ reluctant to expand bond liquidity program as limits approached.
The Bank of Japan
JP is taking a cautious approach to further raising per-bond usage limits under its Supplementary Liquidity Facility (SLF) reduction program, according to multiple sources familiar with the matter. The central bank's reluctance stems from concerns that once market circulation reaches the current 1.5 trillion yen threshold per bond, scarcity diminishes and alternative funding mechanisms become available.
JP is taking a cautious approach to further raising per-bond usage limits under its Supplementary Liquidity Facility (SLF) reduction program, according to multiple sources familiar with the matter. The central bank's reluctance stems from concerns that once market circulation reaches the current 1.5 trillion yen threshold per bond, scarcity diminishes and alternative funding mechanisms become available.
