TOKYO, March 26 Reuters The Bank of Japan will take a more handsoff approach in bond buying operations from April under new guidelines set last week, sources familiar with its thinking said, as it seeks to breathe life back into a market made dormant by its huge presence.

The new approach will be clarified in a schedule of the BOJs bondbuying operations for April due to be released on Wednesday, which has become the focus of market attention for hints to how much the bank will tolerate fluctuations in yields.

The BOJ was very meticulous in responding to yield moves up till now. That will end, said one of the sources, expressing a view echoed by two other sources.

All spoke on condition of anonymity as they were not authorised to speak publicly.

In a review of its policy tools announced on Friday, the BOJ said it would allow 10year bond yields to fluctuate within a 50basispoint range around its target of 0.

The bank also said that from its bondbuying schedule for April, it would indicate the amount of bonds it purchases for each maturity as a specific number, rather than in a range.

Indicating a range had allowed the BOJ to step in frequently to smooth any swings in yields, a practice it will discontinue to allow market forces to drive moves more, the sources said.

Setting a specific number also gives markets predictability regarding how much the BOJ will buy at each operation, and keep investors from focusing too narrowly on its moves, they added.

The BOJ wont…