Slower pace of bond purchases in Japan to support economic recovery

The Bank of Japan plans to slow its purchases of government bonds to 200 billion yen ($13.82 billion) per quarter starting in April 2026. Experts believe that this decision will help prevent a sharp rise in long-term debt yields, which could put additional pressure on the country's economy.

Rodrigo Catril, strategist at National Australia Bank Ltd., notes that the slowdown in bond purchases reduces the likelihood of a surge in yields on long-term Japanese debt securities. Meanwhile, Yugo Tsuboi, a Daiwa Securities Group Inc. expert, highlights the stock market's positive reaction to this week's central bank statement, which contained no surprises. According to Tsuboi, the predictability of the regulator's actions strengthens investor confidence.

Analysts emphasize the need to consider external factors, such as the situation in the Middle East. They believe that such events could indirectly influence the country's monetary policy. 

Experts also suggest that interest rates may rise by the end of the year, provided that trade policy stabilizes.