Key Facts
• Bank of Japan (BOJ) to hold monetary policy meeting on June 16–17, 2025.
• Decision likely to continue reducing government bond purchases beyond April 2026.
• Current reduction plan: ¥400 billion every three months until March 2026.
• BOJ’s monthly bond purchases to decrease from ¥6 trillion to ¥3 trillion by March 2026.
• New plan may slow reduction pace to ¥200 billion every three months post-April 2026.
• Policy interest rate to remain at 0.5% due to global economic uncertainties.
• BOJ aims to enhance market predictability by outlining plans through March 2027.
• Measures to counter sudden interest rate spikes include increasing bond purchases if needed.
Summary
The Bank of Japan (BOJ) is expected to continue reducing its government bond purchases beyond April 2026, as discussed in its upcoming monetary policy meeting on June 16–17, 2025. While the current plan reduces purchases by ¥400 billion every three months until March 2026, the pace may slow to ¥200 billion per quarter starting April 2026 to mitigate market disruptions. The BOJ’s monthly bond purchases are projected to decline from ¥6 trillion to ¥3 trillion by March 2026. Despite global economic uncertainties, the BOJ plans to maintain its policy interest rate at 0.5%. To enhance market predictability, the BOJ will outline reduction plans through March 2027 and retain flexibility to increase bond purchases if interest rates rise sharply.
