BANK OF JAPAN DETERMINED TO KEEP EASY MONEY POLICY The Bank of Japan bought 100 billion yen in certificates of deposit (CDs) via repurchase agreements today to show its determination to maintain an easy money policy, central bank officials said. "Today's CD buying operation was designed to seek an announcement effect, in which we would reassure the market of the fact that we have not changed our policy stance," a senior central bank official told Reuters. The bank also bought 400 billion yen in two-month commercial bills to smooth out tight credit conditions in the interbank market today, the officials said. The central bank was concerned about growing market expectations of higher interest rates, which were in part responsible for the recent plunge in stock and yen bond prices, the officials said. But money traders said the market generally shrugged off the bank's CD operation because it was small and at a rate far below prevailing market rates. The rate on the key three-month CDs in the primary market was 4.08/00 pct, while the bank's bid was 3.75 pct, they said. The bank's bill buying operation also had little impact because it was regarded as a routine operation, they said. The money traders said they regarded the central bank's CD buying operation as simply a gesture to live up to Japan's pledge to guide interest rates lower and stimulate the economy. "We did not expect the central bank to ease its credit grip any further," a bank manager said, adding that the prevailing market expectation of higher rates will remain. "If this is the case, the three-month CD rate will stay above four pct for the time being," he said.