Exclusive-Japan should respond ‘decisively’ to bond selloff, opposition head says

Written by: Leika Kihara and Tamiyuki Kihara

TOKYO, Jan 21 (Reuters) – Japan must act decisively against extreme market moves such as buying back government bonds or reducing the issuance of super-long notes, Yuichiro Tamaki, the head of an influential opposition party, told Reuters on Wednesday.

“Market volatility is increasing significantly, with some abnormal movements seen,” Tamaki said in an interview when asked about the recent sharp sell-off in Japanese government bonds (JGB).

“The government and the Bank of Japan must respond decisively to extreme market movements,” said Tamaki, chairman of the People’s Democratic Party (DPP).

Tamaki said the government may consider buying back bonds or reducing the 40-year JGB issuance, as well as sending a strong message to the markets.

Although smaller than a newly formed opposition coalition, the DPP has a significant presence in parliament and has a decisive vote on key legislation and the ruling coalition’s economic policies.

(Reporting by Leika Kihara and Tamiyuki Kihara Editing by Shri Navaratnam)