TOKYO Feb 23 Japanese government bonds firmed
on Thursday, after better-than-expected demand at an auction of
The benchmark 10-year JGB yield inched down 0.5 bp to 0.075
percent, while 10-year JGB futures were up 0.13
point at 150.21 in afternoon trade, lifted from their
morning session close of 150.16 by the auction results.
Superlong JGBs outperformed, with the 20-year yield
falling 3 bp to 0.660 percent and the 30-year JGB
yield also shedding 3 bp to 0.865 percent.
At the Ministry of Finance's sale of 1.1 trillion yen ($9.71
billion) of 20-year JGBs with a 0.6 percent coupon, 84.1181
percent of the bids were accepted at the lowest price of 98.75.
The sale drew bids of 4.05 times the amount offered, up from
the previous sale's bid-to-cover ratio of 3.54 times.
The tail between the average and lowest accepted prices
narrowed to 0.04, compared with that of last month's 0.08. That
indicates stronger demand for the bonds, which many investors
will likely sell to the Bank of Japan through its asset purchase
The BOJ is considering adding specific dates when it
announces the details of its debt-buying operations each month,
according to sources knowledgeable about the matter. At the end
of each month, the BOJ announces the details of upcoming JGB
buying operations, but until now these have not included the
The central bank buys a wide range of Japanese government
bonds from the market through operations conducted a few times
each week, as a part of its massive easing scheme.
A growing number of analysts now expect the BOJ's next step
to be a withdrawal, not an expansion, of stimulus, most likely
through an increase in its 10-year yield target.
But on Thursday, BOJ board member Takahide Kiuchi said
changing the BOJ's yield target would not be easy as doing so
frequently could erode its credibility.
A former market economist, Kiuchi has been the lone opponent
of the BOJ's asset-purchasing programme and has been proposing
unsuccessfully that the central bank taper its buying.
($1 = 113.2300 yen)
(Reporting by Tokyo markets team; Editing by Shri Navaratnam)