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Capital Markets

BOJ likely to hold steady on the buying of shorter-dated JGBs

Yield curve flattens as rates move closer to central bank's targets

TOKYO -- Market players increasingly believe it is likely that the Bank of Japan will maintain its level of purchases of short- and medium-term Japanese government bonds for now, as their yields continue to move toward where the bank wants them to be.

The BOJ has reduced its buying of short- and medium-term JGBs since March in response to tight demand. Even with the scaled-back central bank purchases, short- and long-term interest rates dropped on some occasions, affected by geopolitical uncertainties stemming from such events as the French presidential election.

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