TOKYO, July 9 (Reuters) - The Japanese government is making arrangements to mention the Bank of Japan's independence in its economic blueprint to clearly show the government has no intention of intervening in monetary policy, Kyodo news agency said on Thursday.
The move comes after the government said in a draft economic blueprint released last month that it was "very important for monetary policy to be guided appropriately to achieve a stronger economy."
Some analysts said the wording sparked a selloff
in Japanese government bonds (JGB), fuelling concerns that the government could pressure the BOJ to keep interest rates low and risk falling behind the curve as inflationary pressures build.
In response, the government revised the language to emphasise the importance of the BOJ conducting appropriate monetary policy "to achieve stable inflation" as Japan seeks to strengthen its economy, according to the revised version of the blueprint obtained by Reuters on Tuesday.
Even after news of the revised wording spread, the benchmark 10-year JGB yield extended its gain, hitting a 30-year high on Thursday.
The Kyodo story cited an unnamed government source as saying, "If it is something that is liable to be misunderstood, we will correct it."
Japan's law grants the central bank independence from political interference, but it also requires close coordination with the government's economic policy.
(Reporting by Kiyoshi Takenaka; Editing by Chizu Nomiyama )
