UPDATE 1-Japan's Dai-ichi Life likely to increase yen bonds in Oct-March
TOKYO Oct 30 (Reuters) - Japan's Dai-ichi Life Insurance is likely to increase its yen bond portfolio in October-March but its stance will depend on their yield levels, a senior official said on Wednesday.
* In the April-September period, Japan's second-largest private life insurer with total assets of 35.7 trillion yen ($364 billion) bought yen bonds after their yields spiked in May, the official said.
* The 10-year Japanese government bond yield has been declining since then, hitting a 5-1/2-month low below 0.600 percent last week on the back of the Bank of Japan's aggressive bond buying.
*"At the moment, JGB yields are at a low level. How much yen bonds we will buy will depend on the yield levels," Tetsuya Kikuta, a manager of investment planning at the firm, told a news conference.
* "If we can't buy (domestic bonds), then it's possible we will buy currency-hedged foreign bonds," he added.
* Dai-ichi also plans to maintain the size of its foreign bond investments without currency hedging steady in the six months to March, after increasing them in April-September.
* "Initially we expected the Fed to start tapering its stimulus earlier. Now we expect U.S. bond yields to stay near the lower end of our forecast," Kikuta said.
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