JGBs tick higher, 10-year yield hovering near 5-month lows

Reuters

TOKYO, Oct 7 (Reuters) - Japanese government bond pricesedged higher on Monday morning, pushing down the 10-year yieldto near five-month lows, with the Bank of Japan supporting themarket with 600 billion yen ($6.2 billion) worth of bond-buying.

The BOJ offered to buy 400 billion yen of JGBs with aresidual maturity of five to 10 years and 200 billion yen inmaturities exceeding 10 years.

The 10-year yield dipped 0.5 basis point to0.645 percent, not far from a five-month low of 0.625 percenttouched on Friday.

Ten-year JGB futures added 0.11 point to 144.47,holding above their five-day moving average of 144.38.

The 20-year yield also eased 0.5 basis pointto 1.495 percent, within striking distance of a five-month lowof 1.475 percent hit last week.

"The 5-7-10-year spread is currently near where it wasaround April 2003, when 10-year yields were roughly at theircurrent levels," Barclays Capital wrote in a note.

"In this sense, one could argue - taking the 5-10-yearsector of the curve in isolation - that levels do not lookparticularly extreme compared with the past," it said.

"However, 20-year yields in 2003 had already fallen to near1 percent and the curve in 10s and longer was so much flatterthat it almost defies comparison."

View Comments (0)

Recommended for You