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19.1.2023 6 MARKETS Symbol Volume Value Trades High Low Open Closing Change Code Traded Traded Trades Price Price Price Price EQUITIES APS 19,413 11,647.80 4 0.600 0.600 0.600 0.600 0.000 BOV 17,093 15,555.18 4 0.915 0.900 0.910 0.900 -0.030 HSB 65,000 48,866.01 12 0.780 0.750 0.750 0.780 0.030 MIA 11,415 64,128.00 5 5.650 5.600 5.600 5.650 0.050 MLT 80,000 52,000.00 1 0.650 0.650 0.650 0.650 -0.035 PG 17,500 36,050.00 1 2.060 2.060 2.060 2.060 -0.020 CORPORATE BONDS 1923A 4,500 4,522.50 2 100.500 100.500 100.500 100.500 0.000 AX24A 3,800 3,838.00 1 101.000 101.000 101.000 101.000 0.000 BV30B 118,600 98,243.60 2 84.000 82.600 84.000 82.600 0.000 BV31A 25,000 22,500.00 1 90.000 90.000 90.000 90.000 7.400 BX27A 5,000 4,875.00 1 97.500 97.500 97.500 97.500 2.500 CF26A 5,000 4,999.50 1 99.990 99.990 99.990 99.990 0.000 DN33A 10,000 10,000.00 1 100.000 100.000 100.000 100.000 -0.010 GP25A 4,100 4,018.00 1 98.000 98.000 98.000 98.000 0.000 HF27A 10,000 9,785.00 1 97.850 97.850 97.850 97.850 0.000 HF29A 2,500 2,325.00 1 93.000 93.000 93.000 93.000 0.200 HP25A 7,400 7,252.00 2 98.000 98.000 98.000 98.000 -0.500 IH24A 9,500 9,500.00 2 100.000 100.000 100.000 100.000 0.000 IH31A 5,000 4,625.03 6 92.510 92.500 92.510 92.500 -0.010 MB29A 25,000 23,487.50 1 93.950 93.950 93.950 93.950 -0.050 MD26A 1,000 990.00 1 99.000 99.000 99.000 99.000 0.000 MF24A 14,000 14,000.00 3 100.000 100.000 100.000 100.000 0.000 MM26A 10,000 9,899.00 2 98.990 98.990 98.990 98.990 -0.010 SH32A 10,000 9,500.00 1 95.000 95.000 95.000 95.000 -2.900 Malta Stock Exchange Regulated Main Market Trading Date: 18 Jan 2023 Bank of Japan has learnt danger of half-measures GOVERNOR Haruhiko Kuro- da's battle with market forces has entered a new phase. e Bank of Japan (BOJ) made no adjust- ments to its yield-curve control (YCC) policy that keeps interest rates ultra-low on Wednesday. at is stinging traders who bet the central bank would be forced to widen a 10-year government bond's trading band again, having expanded it to 0.50% from 0.25% in December under market pres- sure. However, that tweak's failure to reduce the need of central bank intervention has left the BOJ with little appetite for more compro- mises. At its meeting, the central bank maintained its yield targets, set around 0% for 10-year tenors and made no change to its policy allow- ing trade to fluctuate 50 basis points either side of that, even though the market had begun testing that limit right after it was implemented last month. at's why some investors expected the BOJ would offer yet another adjustment by perhaps widening the band to 0.75%. Instead Kuroda rolled out a new tool to hold interest rates down, sig- naling intervention will continue. e central bank spent 10 trillion yen ($77 billion) buying bonds Fri- day and Monday alone, according to a Reuters analysis, and it already owns more than half the sovereign fixed-income market. e yen sof- tened as much as 2.6% against the dollar in response before pulling back, while bond traders pulled the benchmark yield down to 0.41%, well within the band. e BOJ's policy stubbornness re- flects intractable realities. Whatev- er Kuroda does, it hurts, including doing nothing. e real Japanese economy is in rocky shape and in- flation data is muddy. In that con- text, policymakers have cause to await spring wage negotiations – and perhaps Kuroda's retirement in April - before concluding that a sustained demand-driven price rise is underway and sufficient to justify higher rates. Until then, the cur- rent policy template will continue to smother bond market liquidity and distort corporate lending rates, which is how the BOJ justified its decision to widen the trading range on 20 January. e market's rejection of Kuroda's attempt to buy time may have per- suaded him that further half-meas- ures would put him on a slippery slope towards a de-facto interest rate hike that would inhibit eco- nomic recovery. If the U.S. Fed stops hiking ahead of schedule, say, or spring wage negotiations go par- ticularly well, his patience will look prescient. If not, his successor may inherit a market mess. e Bank of Japan on Jan. 18 kept its ultra-low interest rates policy unchanged and maintained a bond yield cap band it has struggled to defend. e BOJ kept intact its yield curve control targets, set at -0.1% for short-term interest rates and around 0% for 10-year yields. e central bank also made no change to its guidance that allows the 10-year bond yield to fluctuate 50 basis points either side of its 0% target. e BOJ also amended rules for a fund-supply market operation to use it as a new tool to prevent long- term interest rates from rising too much. Under the amended rules, the central bank can offer funds of up to 10 years against collateral to financial institutions for both fixed and variable-rate loans. e yen plunged as much as 2.6% against the dollar in reaction to the BOJ announcement, before recov- ering to change hands at 129 per dollar at 0926 GMT. e 10-year sovereign benchmark yield fell from 0.5% to 0.41% at mar- ket close.

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