Morning bid: One last central bank surprise
SPY•The Bank of Japan held rates as expected but said it would speed up sales of its Japanese ETF holdings, cutting the estimated time to unwind them from 112 years to 43. Global shares fell, while US and Japanese 10-year yields declined.
1. BOJ speeds ETF sales
The Bank of Japan held interest rates but said it would speed up its selloff of Japanese exchange-traded funds. At the new pace, unwinding all its ETF purchases would take 43 years, compared with 112 years previously. The BOJ spent 37.19 trillion yen on ETF purchases through March 2024.
2. Shares fall, yields decline
Asian markets extended Wall Street’s tech selloff, with Japan’s Nikkei down 3% at one point and China’s CSI300 heading for its largest monthly fall in a decade. US stock futures fell 0.89%, while 10-year US Treasury yields dropped more than 7 basis points in Tokyo trading. Markets expect the BOJ’s next rate increase in December or January after its September hike to 1.25%.
