TOKYO: Japanese government bonds rose on Wednesday, bolstered by expectations of additional Bank of Japan easing steps, with the benchmark yield matching a record nadir and superlong yields reaching fresh lows.
The 10-year JGB yield edged half a basis point lower to minus 0.135 percent, matching a record set late last month. Since the BoJ unveiled its negative interest rate policy on Jan. 29, investors have clamoured for JGBs that still offer positive yields. Such demand helped the 30-year JGB yield fall 4.5 basis points to a record low of 0.285 percent, while the 40-year yield fell 5.5 basis points to a record 0.300 percent.
The 20-year yield fell 2.5 basis points to 0.250 percent , also a record low.
Earlier in the session, the BOJ offered to buy 350 billion yen of JGBs in the 1- to 3-year zone, 440 billion yen of JGBs in the 3- to 5-year zone, and 450 billion yen of JGBs in the 5- to 10-year zone, under its asset purchase operations.
BoJ Governor Haruhiko Kuroda said on Wednesday that it was technically still possible for the central bank to buy as many JGBs as it wants, and that the BoJ would not reach the limit of its JGB buying for the next few years.
The BoJ could take further easing steps as early as its next policy meeting on April 27-28. It could either expand its asset purchases or cut interest rates even further into negative territory, according to market participants and strategists.
The 10-year JGB future contract ended up 0.06 point at 152.06.
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