The amount of the Bank’s purchases of assets, including those of Japanese government bonds (JGBs) conducted regularly at the pace of 1.8 trillion yen per month, will total as much as 4 trillion yen per month on average. Due to such pursuit of powerful monetary easing, market interest rates in Japan have been moving at an extremely low level.
For example, yields on JGBs with maturities of up to three years have been at around 0.1 percent, which is almost equivalent to money market interest rates, and those on ten-year JGBs have been below 0.9 percent. In these circumstances, firms’ funding costs, as measured by lending rates, and credit spreads in corporate bond and CP markets, have both been moving at low levels.