July 12, 2017 / 6:40 AM / 14 days ago

JGBs mostly higher as BOJ buys more three- to five-year debt

2 Min Read

    TOKYO, July 12 (Reuters) - Japanese government bonds were
mostly higher on Wednesday, with sentiment bolstered by the Bank
of Japan's move to increase its purchases of three- to five-year
JGBs in its market operations to curb a recent rise in
short-term yields.    
    The 10-year cash JGB yield                was flat on the
day at 0.090 percent, while the September 10-year JGB futures
contract          finished up 0.10 point at 149.88.     
    In the superlong zone, the 20-year JGB yield               
fell one basis point to 0.625 percent, while the 30-year JGB
yield                also fell one basis point at 0.895 percent.
    The 5-year JGB yield               was flat on the day at
minus 0.040 percent. The five-year yield on Monday rose to minus
0.035 percent, its highest rate in nearly 1-1/2-years.
    The BOJ offered to buy 330 billion yen ($2.90 billion) of
JGBs in the three- to five-year zone on Wednesday, up from 300
billion yen at its previous purchase operations.
    While the central bank does not have an explicit target for
the five-year yield, it aims to keep the benchmark 10-year yield
"around zero percent" even as it has come under upward pressure
from rising global yields.
    On Friday, after the benchmark 10-year JGB yield scaled a
five-month high of 0.105 percent, the BOJ announced unlimited
10-year JGB purchases at 0.110 percent, and an increase in its
regular buying in that maturity through an auction.
    
    ($1 = 113.6200 yen)
      

 (Reporting by Tokyo markets team; Editing by Sherry
Jacob-Phillips)
  

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