TOKYO, July 3: Japanese government bond prices declined slightly on Wednesday as traders took advantage of the Bank of Japan’s bond-buying operation to offload some of their holdings, ahead of a 30-year debt auction on Thursday.
* The BOJ offered to buy 950 billion yen ($9.5 billion) of JGBs with residual maturities ranging from one to 10 years, as part of its radical monetary easing steps to pull the world’s third-largest economy out of deflation.
* The 10-year yield was up 0.5 basis point at 0.895 percent, holding at the high end of the trading range of 0.80 to 0.90 percent over the past five weeks.
* ‘Market players would like to unload some inventories today,’ said Naomi Muguruma, senior fixed-income strategist at Mitsubishi UFJ Morgan Stanley Securities.
‘We will have the 30-year auction tomorrow, so there is some position adjustment ahead of the auction. The BOJ operation was not a surprise. The demand among traders to reduce inventories outweighs the effectiveness of the BOJ operation.’
* JGB yields have stabilised recently from the volatility that has buffeted trade just after the BOJ stunned financial markets with its promise to inject $1.4 trillion into the economy in less than two years on April 4.
* Ten-year JGB futures were flat at 142.28 on Wednesday morning after earlier trading as high as 142.40.
* The 30-year yield inched 0.5 basis point higher to 1.905 percent, its highest in six weeks, ahead of the 600 billion yen auction of the same maturities on Thursday.
* The 20-year yield added 1 basis point to a one-week high of 1.760 percent.
($1 = 100.4050 Japanese yen)
(agencies)
Trending Now
E-Paper
Follow our WhatsApp channel