Japanese shares pared losses after the yen slid on the Bank of Japan’s first unlimited fixed-rate bond-purchase operation since February.
The Topix index trimmed its retreat to 0.2 per cent by the midday break from as much as 0.7 per cent as the BOJ’s move caused Japan’s currency to depreciate 0.5 per cent to reverse a three-day advance against the dollar. The operation pushed down government bond yields, causing banks to slump. Japanese shares remained lower after the S&P 500 Index had its steepest slump in seven weeks.
“The yen moving toward weakness is probably a reaction to the BOJ’s actions,” said Takuya Takahashi, a Tokyo-based senior strategist at Daiwa Securities Co. “Japanese long-term yields have been rising in tandem with yields overseas, so the BOJ is probably trying to rein that in a little.”Risk Warning:
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