November 29, 2019 / 1:53 AM / 16 days ago

BOJ mindful of risks from excessive fall in super-long yields - senior official

FILE PHOTO : A security guard walks past in front of the Bank of Japan headquarters in Tokyo, Japan January 23, 2019. REUTERS/Issei Kato/File Photo

TOKYO (Reuters) - The Bank of Japan is guiding its ultra-loose monetary policy with an eye on the risk that excessive declines in super-long government bond yields could hurt the economy, a senior BOJ official said on Friday.

“We’re mindful that excessive declines in super-long bond yields, such as those with maturity of 20 years, could hurt public sentiment and economic activity by lowering the interest life insurers and pension funds earn from their investment,” BOJ Executive Director Eiji Maeda told parliament.

“But the current ultra-loose monetary environment is stimulating the economy by spurring capital expenditure and housing investment. That will push up household income and asset prices,” he said.

Reporting by Leika Kihara; Editing by Chang-Ran Kim

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