June 30, 2017 / 7:33 AM / in a year

BOJ's JGB buying slows in April-June, hits lowest since 2014

TOKYO, June 30 (Reuters) - The Bank of Japan's bond buying slowed to the slowest pace in almost three years in the April-June quarter, Reuters calculations based on the central bank's operation announcements showed on Friday.

The reduction came as the world's few other central banks signalled that they are likely to scale back their stimulus in light of an improving economy.

The BOJ bought 24.4 trillion yen ($217.8 billion) of JGBs in the three months to June, down from 27.1 trillion yen in the previous quarter and the smallest amount since the July-September period of 2014, when it bought 19.0 trillion yen.

Policymakers from the European Central Bank, the Bank of England and the Bank of Canada all signalled this week that they are looking to tighten their policies.

On the other hand, the BOJ has not dropped any such hints and the expansion of its balance sheet looks set to continue in the foreseeable future.

The Japanese central bank has said it was still aiming to increase its bond holding by about 80 trillion yen per year, even after it introduced its "yield curve control" policy last September.

Still, the pace of the increase in its JGB holding has already slowed to about 70 trillion yen by last month and looks set to fall to around 60 trillion yen by the end of year if the current pace of buying continues.

The BOJ's balance sheet hit the 500 trillion yen mark last month and looks set to overtake Japan's GDP within a year, raising some questions about the sustainability of its massive buying.

$1 = 112.02 yen Reporting by Hideyuki Sano; Editing by Amrutha Gayathri

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