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BOJ chief says no set rule for ETF buying as part of monetary easing

This photo shows the Bank of Japan headquarters building in Tokyo's Chuo Ward. (Mainichi)

TOKYO (Kyodo) -- Bank of Japan Governor Haruhiko Kuroda said Thursday there is no set rule for the central bank's purchases of exchange-traded funds as part of its large-scale monetary easing, as speculation is rife about when the bank may enter the stock market which has fallen sharply this week.

    Kuroda, however, declined to elaborate on conditions under which the central bank may enter the market for ETF purchases, telling an upper house budget committee that giving out such information could potentially affect stock trading.

    The BOJ has not purchased ETFs recently despite the Nikkei Stock Average's loss of 7.0 percent and the Topix's drop of 5.3 percent over the last three sessions.

    "We are not going after specific stock price targets" through ETF purchases, Kuroda said.

    The central bank said in March it would step up ETF purchases only in times of market turmoil, while dropping its annual purchase target of 6 trillion yen ($55 billion). Economists and financial market experts had voiced concern about the possibility of the BOJ's years of asset purchases distorting the market mechanism.

    One analyst at a major securities brokerage said expectations for the central bank's ETF buying grow in the market when the Topix falls 1 to 2 percent in the morning session.

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