TOKYO: Japanese government bond yields rose on Thursday, buoyed by a Reuters report of a plan to boost 10-year and 40-year bond sales, although gains were capped as the government aims to reduce the overall sale amount.
Japan plans to boost the sale of 40-year government bonds by 17% to 4.2 trillion yen ($37 billion), although it plans to cut its bond issuance overall, two sources with direct knowledge of the matter said.
The 40-year JGB yield rose 1.5 basis points to 0.725% and the 10-year JGB yield rose 0.5 basis point to 0.060%.
While the issuance plan including 40-year bonds appears largely in line with investors’ demand, the increase in 10-year bonds was a bit surprising, said Chotaro Morita, chief bond strategist at SMBC Nikko Securities.
But the reduced size of the planned sale would be a relief for investors, a market participant said.
The 20-year JGB yield also rose 0.5 basis point to 0.465% and the 30-year JGB yield rose 1 basis point to 0.675%.
The two-year JGBs were not traded and their yield stayed at minus 0.105%. The five-year yield was flat at minus 0.090%.
Benchmark 10-year JGB futures fell 0.02 point to 151.88, with a trading volume of 11,213 lots.
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