Bank of Japan board member Ryuzo Miyao said sustained yen gains may affect the central bank’s economic outlook, the Asahi newspaper reported. Miyao told the newspaper in an interview that he will monitor the situation.
The Bank of Japan will boost purchases of five- and 10-year bonds to cut corporate borrowing costs and spur the nation’s flagging economy, according to the asset-management unit of Mitsubishi UFJ Financial Group Inc., the nation’s biggest lender.
Japan’s benchmark bonds completed the biggest two-week advance since December 2008 on speculation the nation’s central bank and the Federal Reserve will increase liquidity amid signs of slowing global economic growth.
The Bank of Japan’s Tankan survey will probably show a slowing pace of improvement in business confidence, adding to pressure on policy makers to counter gains in the yen by injecting more cash into the economy.