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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Sometimes a picture speaks a thousand words. The pronounced kink in the JGB curve is the major issue that BoJ Governor Kuroda was referring to when it came to the need improve market functioning via the well-documented modification to the Bank’s YCC settings, as it looks to encourage a smoother formation of the entire yield curve (with that pursuit not aided by the fact that the BoJ now owns over 50% of outstanding JGBs). Kuroda continually stressed that the policy tweak was to facilitate the transmission of monetary easing (and didn’t represent tightening), while flagging the negative impact on corporate bond issuance from a distorted yield curve. The kink is still there, but it’s slightly less pronounced. This creates a natural desire to test the BoJ’s will and would have played into the BoJ’s decision to upsize Rinban operations in Q123.
Fig. 1: JGB Yield Curve Move On 20 Dec ‘22
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.