TOKYO, April 5 The price of short-dated Japanese
government bonds rose on Wednesday after the Bank of Japan
reduced purchase in those maturities less than expected, while
those of longer maturities dipped ahead of an auction the
In its bond-buying operation on Wednesday, the BOJ offered
to buy 280 billion yen ($2.53 billion) of one- to three-year
JGBs, 20 billion yen less than previous such operations and the
lowest level in almost three years.
Many market players still expected a larger reduction as the
central bank said it would buy 200 billion yen to 300 billion
yen of one- to three-year tenors each time this month, making
the middle point of that range, 250 billion yen, a consensus
In addition, the BOJ did not reduce buying in three- to
five-year sector, maintaining its purchase at 380 billion yen,
compared with the pre-announced target range of 300 billion
yen-400 billion yen for this month.
Those surprises helped to underpin short-term bonds, pushing
down the two-year JGB yield 1.5 basis point to minus 0.200
The five-year yield fell 1.0 basis point to minus 0.135
On the other hand, longer-dated bond prices eased, boosting
their yields, ahead of Thursday's auction of long-dated bonds.
The Ministry of Finance plans to sell 500 billion yen of
existing 20- and 30- year JGB issues with 15 years or more left
The 20-year yield rose 1.0 basis point to 0.645 percent
, while the 30-year yield gained 2.0 basis points
to 0.875 percent.
The 40-year yield rose 2.5 basis points to 1.090 percent
, its highest level since February last year.
The 10-year JGB yield rose 0.5 basis point to 0.065 percent
The 10-year JGB futures, price of which reflects cheapest to
deliver seven-year bonds, rather than 10-year bonds, rose 0.05
point to 150.44.
($1 = 110.61 yen)
(Reporting by Tokyo Markets Team; Editing by Sherry