BoJ Governor Contender Ito: BoJ could widen band around its 10-year yield target by mid-year

Takatoshi Ito, a contender to succeed Bank of Japan (BoJ) Governor Haruhiko Kuroda, said on Thursday that “the BoJ's next step may be to widen band around its 10-year yield target,” adding that the central bank could raise yield cap to 0.75% or 1.0% by mid-year.”

Key quotes

BoJ likely won't tweak yield curve control at least until April.

BoJ may abandon negative rates this year depending on inflation, wage developments.

If BoJ were to abandon yield curve control, it would need to conduct a comprehensive examination of its policy framework.

Market reaction

At the time of writing, USD/JPY is sustaining its rebound near 128.60, still down 0.20% on the day.