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MNI Japan 10-Year JGB Yield Falls to -0.290%; May Test -0.300%

MNI (London)
     TOKYO (MNI) - The yield on 10-year Japanese government bonds fell to
-0.290% on Thursday, increasing pressure on the Bank of Japan to widen their
unofficially tolerated trading range of -0.20% to +0.20%.
     JGB players expect the 10-year bond yield to test a historical low of
-0.300% marked in July 2016 in coming days, as prices remain firm on the back of
the sustained concern over the global economy and speculation that the U.S.
Federal Reserve will cut its policy interest rate at the September 17-18
policy-setting meeting.
     The BOJ's two-day policy meeting is scheduled for Sept. 18-19.
     BOJ officials are concerned over the risk that the Fed's rate cut could
push the yen higher, which in turn will increase pressure on the BOJ into
additional easing.
     The dollar traded at around Y105.86 in late Tokyo trade after falling to
around Y104.40 on Monday -- the lowest level in seven months.
     The drop in JGB yields is also upping the pressure on the BOJ to consider
reducing the scale of its bond buying. and the central bank will publish its
guidelines for its JGB buying operations for September at 1700 JST (0800 GMT) on
Friday.
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com
--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com
MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com

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