JGBs edge down as stocks strengthen

29 Dec, 2015

TOKYO: Japanese government bond prices mostly edged down in thin end-of-year trade on Tuesday, taking their cues from a rise in equities markets.

The Nikkei stock index ended up 0.6 percent.

The benchmark 10-year JGB yield inched up half a basis point to 0.270 percent, while March 10-year JGB futures ended up 0.02 point at 149.05, after treading water in a narrow 149.01-149.07 range in both the morning and the afternoon sessions.

The yield on the 2-year JGB also added half a basis point to minus-0.010 percent, though the 5-year JGB yield bucked the trend and edged down half a basis point to 0.030 percent, its lowest since Dec. 18.

In the superlong zone, the 20-year JGB yield rose 0.5 basis point to 1.005 percent, while the 30-year yield rose 1 basis point to 1.275 percent.

According to an interview published in the Nikkei newspaper, Bank of Japan board member Yukitoshi Funo said the central bank will look at the long-term economic trend in guiding monetary policy and won't expand stimulus automatically in response to short-term dips in prices.

Funo, who joined the nine-member board in July, said Japan is on track to meet the central bank's 2 percent inflation target as companies steadily raise prices.

Copyright Reuters, 2015

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