BoJ Becomes Largest Holder of Japanese Debt

The Bank of Japan became the biggest holder of the country’s government bonds in the first quarter of the year due to its massive asset purchases to help boost the economy, the central bank’s data showed Wednesday.

The BOJ held 201 trillion yen ($1.97 trillion) worth of Japanese sovereign debt at the end of March, up 57.2 percent from a year earlier and the biggest amount for the central bank since comparable data became available in the fourth quarter of 1997.

The BOJ’s holdings represented 20.1 percent of the overall outstanding balance, topping the share of insurance firms at 19.3 percent.

The overall balance increased 3.0 percent to 998 trillion yen. Insurers increased their holdings by 0.3 percent to 193 trillion yen while those of domestic banks went down 18.1 percent to 130 trillion yen.

The BOJ has purchased massive amounts of government bonds and other financial assets from banks under its ultraloose policy aimed at doubling the money it provides to the economy and raising the nation’s inflation rate to 2 percent within about two years since the policy framework was introduced in April 2013.

via Mainichi

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza