UPDATE 1-BOJ to buy lower-rated corporate debt – Nikkei

Oct 23 (BestGrowthStock) – The Bank of Japan (BOJ) is planning to
buy corporate bonds rated “BBB” as well as second-tier
commercial paper in its bid to help companies procure funds,
the Nikkei business daily reported.

On Oct. 5, the BOJ pledged to pump more funds into the
struggling economy and keep rates virtually at zero, surprising
markets and stealing a march on the Federal Reserve in
providing a fresh dose of economic stimulus. [ID:nTOE69305D]

BOJ Governor Masaaki Shirakawa and the rest of the bank’s
policy board are expected to outline the contours of the
program at their next monetary policy meeting on Thursday, the
paper said.

Board members are leaning toward endorsing purchases of a
broad range of bonds and commercial paper to show that the BOJ
is serious about easing, the Nikkei said.

Specifically, they plan to set their sights as low as
BBB-rated bonds — the bottom class of investment-grade bonds
— and a-2 commercial paper, the second tier of this type of
short-term debt, the business daily said.

The central bank is expected to devote a total of 1
trillion yen ($12.29 billion) to both types of assets, the
paper reported.

Assets on BOJ’s balance sheet totaled 121 trillion yen at
the end of September, the equivalent of 26 percent of Japan’s
nominal gross domestic product, the daily said.

($1=81.34 Yen)
(Reporting by Supantha Mukherjee in Bangalore; Editing by Anne
Pallivathuckal)

UPDATE 1-BOJ to buy lower-rated corporate debt – Nikkei