Japan's central bank launches 'new phase of monetary easing' Japanese benchmark borrowing costs fell to their lowest level in almost ten years, as the bank announced that it would also double its purchases of long term government bonds and extend average maturities to seven years, from slightly less than three years at present. Yields on benchmark 10-year government bonds fell by more than 11 basis points to 0.436pc, a level not seen since June 2003. Analysts said the central bank's move was bold. "Mr Kuroda has come out with guns blazing in his inaugural meeting as Bank of Japan (BoJ) Governor, surpassing our own expectations and those of the market with aggressive policy measures to put an end to deflation in the Japanese economy," said Brian Jackson, global foreign exchange strategist at Coutts. Mr Kuroda dismissed fears that the bank's policy could lead to a spike in long-term yields or an asset price bubble. The chance of this happening is actually very small. I don't think there is a bubble in the government bond market," he said. Japan's central bank has vowed to meet the 2pc inflation target within two years, bowing to demands from Prime Minister Shinzo Abe to end a long spell of deflation that has hindered investment and economic growth. Kiyoko Katahira, an analyst at Societe Generale, said: "The new BoJ has broken with the cautious policies of the past and has started a monetary policy that can be called 'bold', just as the PM Abe has demanded. We wait to see for further implications ahead.