Japan’s 10-year government bonds rose, pushing yields to toward a six-week low, on speculation the Bank of Japan will unveil additional easing steps after a two-day policy meeting ends today.
Ten-year bond futures climbed to the highest level in seven years after Nikkei English News said the central bank may increase purchases of government bonds. Demand for the safety of fixed-income securities also increased after Pacific Investment Management Co., which runs the world’s biggest bond fund, said it’s “difficult” for Japan’s economy to grow.
“Japan’s bond market will remain at a high level, with investors awaiting the result of the central bank’s meeting,” Akihiko Inoue, chief strategist at Tokyo-based Mizuho Investors Securities Co., wrote in a report today. “A drastic remedy such as increasing purchases of long-term bonds may be announced.”
The yield on the benchmark 10-year bond sank one basis point to 0.925 percent as of 9:08 a.m. in Tokyo at Japan Bond Trading Co., the nation’s largest interdealer debt broker. The 1 percent security due September 2020 rose 0.092 yen to 100.683 yen. The yield sank to 0.92 percent on Sept. 29, the lowest since Aug. 26. A basis point is 0.01 percentage point.
Ten-year bond futures for December delivery gained 0.08 to 143.53 at the Tokyo Stock Exchange, the highest since June 2003.
Debt Purchases
The Bank of Japan may decide to boost buying of long-term government bonds as the yen strengthens, Nikkei reported today, without citing anyone. The central bank may also announce the purchase of securities backed by lending to small and midsize businesses, Nikkei said.
Japanese Economy Minister Banri Kaieda said yesterday that the country’s outlook is “extremely severe” in part because of the yen’s appreciation. A stronger yen reduces the value of overseas sales at Japanese companies when repatriated.
“It is difficult to generate growth given Japan’s deflationary and demographic realities,” Paul McCulley, a managing director at California-based Pimco, said on the company’s website. “Japan has limited political willingness to boldly pursue reflationary policies, and they have major doubts as to the effectiveness of such measures, even if tried.”
To contact the reporter on this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
http://jodnet.blogspot.com
Ten-year bond futures climbed to the highest level in seven years after Nikkei English News said the central bank may increase purchases of government bonds. Demand for the safety of fixed-income securities also increased after Pacific Investment Management Co., which runs the world’s biggest bond fund, said it’s “difficult” for Japan’s economy to grow.
“Japan’s bond market will remain at a high level, with investors awaiting the result of the central bank’s meeting,” Akihiko Inoue, chief strategist at Tokyo-based Mizuho Investors Securities Co., wrote in a report today. “A drastic remedy such as increasing purchases of long-term bonds may be announced.”
The yield on the benchmark 10-year bond sank one basis point to 0.925 percent as of 9:08 a.m. in Tokyo at Japan Bond Trading Co., the nation’s largest interdealer debt broker. The 1 percent security due September 2020 rose 0.092 yen to 100.683 yen. The yield sank to 0.92 percent on Sept. 29, the lowest since Aug. 26. A basis point is 0.01 percentage point.
Ten-year bond futures for December delivery gained 0.08 to 143.53 at the Tokyo Stock Exchange, the highest since June 2003.
Debt Purchases
The Bank of Japan may decide to boost buying of long-term government bonds as the yen strengthens, Nikkei reported today, without citing anyone. The central bank may also announce the purchase of securities backed by lending to small and midsize businesses, Nikkei said.
Japanese Economy Minister Banri Kaieda said yesterday that the country’s outlook is “extremely severe” in part because of the yen’s appreciation. A stronger yen reduces the value of overseas sales at Japanese companies when repatriated.
“It is difficult to generate growth given Japan’s deflationary and demographic realities,” Paul McCulley, a managing director at California-based Pimco, said on the company’s website. “Japan has limited political willingness to boldly pursue reflationary policies, and they have major doubts as to the effectiveness of such measures, even if tried.”
To contact the reporter on this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
http://jodnet.blogspot.com
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