1. JGBs slip, taking cues from US Treasuries

JGBs slip, taking cues from US Treasuries

Japanese government bonds slipped on Wednesday, taking their cue from a jump in U.S. Treasury yields overnight, while the yield curve steepened as the Bank of Japan refrained from buying in the superlong zone in its purchase operations.

By: | Tokyo | Published: October 5, 2016 1:13 PM
The benchmark 10-year JGB yield added 1 basis point (bp) to minus 0.065 percent, while December 10-year futures ended down 0.04 point at 152.06. (Reuters) The benchmark 10-year JGB yield added 1 basis point (bp) to minus 0.065 percent, while December 10-year futures ended down 0.04 point at 152.06. (Reuters)

Japanese government bonds slipped on Wednesday, taking their cue from a jump in U.S. Treasury yields overnight, while the yield curve steepened as the Bank of Japan refrained from buying in the superlong zone in its purchase operations.

The benchmark 10-year JGB yield added 1 basis point (bp) to minus 0.065 percent, while December 10-year futures ended down 0.04 point at 152.06.

The central bank offered to buy 400 billion yen ($3.89 billion) of JGBs maturing in 1 to 3 years, 420 billion yen of 3- to 5-year JGBs, 410 billion yen of JGBs maturing in 5 to 10 years, and 25 billion yen of inflation-linked JGBs.

“Some people expected a superlong term operation, but the BOJ didn’t offer to buy any today,” leading that zone to modestly underperform, said Keiko Onogi, senior strategist at Daiwa Securities.

The 20-year JGB yield added 3 bps to 0.380 percent , while the 30-year yield rose 4 bps to 0.495 percent.

On Tuesday, U.S. Treasury yields rose to nearly two-week highs after a Bloomberg report that the European Central Bank may taper asset purchases spooked investors.

An ECB media officer tweeted later on Tuesday, however, that the central bank’s decision-making body has not discussed reducing the pace of its monthly bond-buying

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