JGBs slightly down in quiet trade as BOJ holds steady

Thursday, 31 Oct 2013 | 12:24 AM ET

TOKYO, Oct 31 (IFR) - Japanese government bond prices eased slightly on Thursday in relatively quiet trading after the Bank of Japan kept its monetary policy steady as expected.

A rebound in U.S. Treasury yields overnight had some negative impact on JGBs. In the morning session, several regional banks continued to sell 5-year to 10-year JGBs sporadically, while a few domestic lifers bought 13-year JGBs in small lots to average down costs.

The BOJ did not offer to buy JGBs in the secondary market under its JGB buying program, as the central bank held its one-day policy board meeting.

By a unanimous vote, the BOJ maintained its pledge to increase Japan's monetary base by 60-70 trillion yen ($611.34 billion-$713.23 billion) a year.

As usual, one large nationwide public pension fund was buying JGBs across the curve today and was expected to make further purchases on Friday for its turn-of-the-month duration adjustments, market participants said.

In early afternoon trading, the yield on the current 5-year JGBs was up 0.5 basis point from Wednesday at 0.20 percent, while the 10-year yield also rose by that amount to 0.590 percent

In the superlong zone, the 20-year yield was up 0.5bp at 1.480 percent, while the 30-year yield added 1 basis point to 1.620 percent.

Lead December JGB futures slipped 0.05 point to 145.07. Earlier, they moved in a 145.03-145.14 range before finishing the morning session down 0.02 point at 145.10.