BOJ's Latent Losses on JGBs Hit Record 13.6 T. Yen

Tokyo, Nov. 27 (Jiji Press)--The Bank of Japan said Wednesday that unrealized losses on its holdings of Japanese government bonds widened to a record 13,660.4 billion yen at the end of September from 10.5 trillion yen a year earlier.

JGB prices fell as the central bank ended its negative interest rate policy in March and raised interest rates in July. The benchmark 10-year JGB yield rose from below 0.75 pct at the end of March to around 0.85 pct at the end of September. Bond yields move in the opposite direction to prices.

The valuation losses are not reflected in the BOJ's financial statements as the central bank is supposed to hold JGBs to maturity.

BOJ Governor Kazuo Ueda has said that growing latent losses "would not hinder (the central bank's) ability to manage policy."

Still, there are fears that a possible rise in concerns about the BOJ's financial position could affect bond and currency markets.

[Copyright The Jiji Press, Ltd.]