TOKYO: Japanese government bonds were steady on Wednesday on the eve of the Bank of Japan's policy meeting, with month-end buying lifting the superlong zone and offsetting any impact from rallying equities.
The BOJ will begin its two-day meeting on Thursday, and some investors speculate that policymakers might muster some more monetary easing steps. While the central bank would prefer to hold back, people familiar with the BOJ's thinking say that recent global market volatility could yet force its hand.
The BOJ is also likely to weigh the outcome of the Federal Reserve's two-day policy meeting that will end later on Wednesday.
The benchmark 10-year yield was flat at 0.215 percent , while March 10-year JGB futures added 0.03 point to end at 149.58.
The yield on the 20-year JGB slipped 1 basis point to 0.905. The 30-year JGB yield shed 2 basis points to 1.145 percent, after earlier touching 1.140 percent, its lowest in a year.
Earlier on Wednesday, the BOJ offered to buy a total of 1.26 trillion yen ($10.66 billion) of JGBs under its asset purchase programme, comprised of 400 billion yen in the 1-year to 3-year zone, 420 billion yen in the 3-year to 5-year zone, 260 billion yen in the 10-year to 25-year zone, and 180 billion yen of JGBs maturing in over 25 years.
JGB gains were limited by surging stocks, which sapped some of the safe-haven appeal of government debt. The Nikkei stock index ended up 2.7 percent.
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