Tokyo, Feb 1 (IANS): The Bank of Japan (BOJ) bought a monthly record of 23.69 trillion yen ($182 billion) worth of Japanese government bonds in January, the central bank's data showed on Wednesday.

The purchase amount in January was the biggest on record and exceeded the previous high of 16.2 trillion yen ($125 billion) marked in June 2022 as the BOJ tried to counter increased bond sales in the market caused by its yield control policy, Xinhua news agency reported.

Under its yield curve control programme, the BOJ sets short-term interest rates at minus 0.1 per cent while guiding 10-year Japanese government bond yields around zero per cent.

At its policy meeting in December, the BOJ announced a shift in its ultra-loose monetary policy, raising the yield on the 10-year Japanese government bond as high as 0.5 per cent from a previous cap of 0.25 per cent.

The bulk buying highlights the increasing difficulty the central bank faces in sustaining its yield control policy, as inflation perks up well above its 2 per cent inflation target.

Economists here said the BOJ is increasingly relying on a new funds-supply tool to keep the 10-year yield from breaching its 0.5 per cent ceiling, but in doing so is increasing, not reducing, distortions in the bond market.