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Bank of Japan's government bond holdings exceed 50% of total

Central bank's debt holdings hit record high in defense of its yield cap

The Bank of Japan headquarters in Tokyo: Analysts forecast the central bank's holdings of JGBs will eventually exceed 60% of the total issued. (Photo by Akira Kodaka) 

TOKYO -- The share of Japanese government bonds held by the Bank of Japan has topped 50%, hitting a record high as the central bank has accelerated its government debt purchases to hold down long-term interest rates.

The BOJ is buying up the majority of the JGBs, creating distortions in the bond market, including an inverted yield curve where the interest rate on some short-term bonds is higher than that for long bonds.

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