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JGBs Rise on Virus Alert, Take BOJ Buying Slice in Stride

Japanese government bond rates advanced on Monday as nerves over the coronavirus pandemic bolstered apparent risk-off resources, in spite of a successful slice in the Bank of Japan's purchasing in long-dated bonds.

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Benchmark 10-year Japanese government bond futures added 0.18 points to 152.81, with exchanging volume arriving at a little more than 11,000 lots by mid-evening exchange.

The 10-year Japanese government bond yield tumbled 1.5 bps to minus 0.055 percent.

The BOJ purchased 120 billion yen ($1.09 billion) of 10-25 year Japanese government bonds, proposing its total purchasing in those maturities this month will be sliced 20 percent this month from January after it declared an arrangement to get them just twice this month, contrasted with 3 times until January.

The market took the idea in its stride, yet, with the 20-year Japanese government bond yield skidding 1.5 bps to 0.235 percent.

The 30-year Japanese government bond yield dropped 2 bps to 0.370 percent.

While the slice in the BOJ's buys proposed the national bank needs to see the yield curve more extreme, the move would have constrained effect considering solid interest from traders for bonds with positive yields, market players said.

At the shorter end of the market, the two-year Japanese government bond yield tumbled 1 bp to minus 0.160 percent, while the five-year yield slipped 1 bp to minus 0.150 percent.

Source: Reuters


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