Japanese Banking Minister Issues Statement Today

[Realistbear]

http://www.newspress.com/Top/Article/artic...720291964912506

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Japan finance minister says long-term bond yields rising too quickly

April 20, 2006 12:25 AM

TOKYO (AP) - Long-term interest rates in Japan's bond market are climbing too quickly, Finance Minister Sadakazu Tanigaki said Thursday, expressing concern that market players may not correctly understand the Bank of Japan's monetary policy.

Japanese bond yields have been rising steadily since the central bank ended its super-easy policy last month and indicated that it plans to start raising interest rates as the economy recovers.

The yield on the 10-year Japanese government bond briefly rose to 2 percent Tuesday, marking the highest level since August 1999. It was most recently trading at a yield of 1.9 percent.

Japanese Economy and Banking Minister Kaoru Yosano, who also appeared before the committee, said there is little the government can do about interest rates.

''Rates can be controlled in the short run but not in the long run,''

he said.

Reading the lines as opposed to between the lines: IR rises are going to continue and the BoJ is not willing to reign them in. Better to blame the market for the economic correction to come than to admit that it was Japanese policy. At least this time Japan has issued plenty of warning.

Edited April 20, 2006 by Realistbear

[Realistbear]

IR hikes from BoJ could begin as early as July:

http://today.reuters.com/investing/finance...AN-HOSOKAWA.XML

Thu Apr 20, 2006 4:47 AM ET

Although the Bank of Japan has promised to keep short-term rates at zero for some time, expectations for higher rates as early as this summer have pushed bond yields sharply higher.

Signs that the economy will continue to grow have raised expectations that the central bank will raise interest rates from zero, where they have been for five years,

as early as July

.

Edited April 20, 2006 by Realistbear