Cadence Research · Reviewed 2026-07-30
What is yield curve control?
Yield curve control is a policy in which a central bank targets a particular government-bond yield, often at a longer maturity, and buys or sells bonds as needed to keep that yield near the target. It differs from ordinary rate policy because it directly addresses a point on the yield curve rather than only a short-term policy rate.
Why it matters
Longer-term government yields influence mortgages, corporate borrowing, and financial conditions. Yield curve control can therefore shape the economy even if the short-term policy rate changes little.
How it appears in official communication
A central bank specifies the maturity and yield it targets, then describes the operations it will use to maintain that target or the conditions for changing the framework.
A common misunderstanding
Yield curve control is not identical to QE. QE often targets the quantity of assets bought, whereas yield curve control targets the price or yield of particular bonds.
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Related guides
Primary sources
- Quantitative and Qualitative Monetary Easing with Yield Curve Control (Bank of Japan)
- Monetary Policy: What are its goals? (Federal Reserve)
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