TOKYO, April 10 Japanese government bonds held
on to their slight gains on Tuesday after the Bank of Japan
refrained from taking further monetary easing steps at its
policy meeting, but was seen as likely to take them later this
* BOJ policymakers held policy steady as expected, and
maintained its assessment the economy is showing some signs of
picking up. But it also offered a cautious view on business
sentiment, saying it was more or less flat.
* The yield on the latest 10-year notes was
down half a basis point at 0.960 percent. That matched Monday's
intraday nadir, which was its lowest level since March 1, as
investors positioned for the possibility of a surprise easing.
* Most strategists had expected the central bank to hold off
from deciding on any new easing measures until at least its next
meeting on April 27.
* After its April 27 meeting, the BOJ is scheduled to issue
its latest economic outlook, which is likely to show that a
sustained end to deflation is a long way off. That would give
central bank policymakers some clear justification to take
easing steps without appearing as if they are bowing to
* Japanese politicians kept up the drumbeat of rhetoric on
Tuesday for the central bank to continue to take action.
Finance Minister Jun Azumi said on Tuesday he thinks the
Bank of Japan will take appropriate monetary policy steps when
Economics Minister Motohisa Furukawa said on Tuesday he
continues to expect the Bank of Japan to take flexible and bold
measures to achieve its 1 percent inflation goal.
* When the BOJ does take further steps, strategists say it
will probably again expand its 65 trillion yen asset buying and
loan programme, mostly by committing to purchase more JGBs.
* The June 10-year JGB futures contract added 0.06
point to 142.38. It hit a four-week high of 142.42 on Monday.
* The yield on the 20-year bond lost 1 basis
point to 1.735 percent, retracing a more than six-week low
touched on Monday.
The 30-year bond yield shed 1.5 point to
* The five-year yield slipped half a point to