TOKYO, June 27 Japanese government bond prices
rose on Thursday, tracking U.S. Treasuries and also lifted by
month-end buying by funds.
* An unexpected downward revision to first-quarter U.S.
economic growth eased fears that the U.S. Federal Reserve would
taper its bond-buying stimulus, which bolstered U.S. debt
* "There is a much stronger tone in the market today, after
U.S. yields came down overnight after the data," said a
fixed-income fund manager at a Japanese trust bank.
"There is also lots of adjustment this week, the last
trading week of June, which is providing more support," he
* Some funds buy longer-dated JGBs near the end of a month
to extend the duration of their portfolios.
* Japanese investors also have more cash to invest as they
repatriate funds after unloading foreign debt.
The Ministry of Finance data showed Japanese investors' net
selling of foreign bonds hit its highest level in 14 months last
* Not all of that cash is earmarked for bonds, however.
Takahiro Mitani, chairman of Japan's public pension fund, told
Reuters on Wednesday that he believes the Tokyo stock market has
room to rally to catch up with the share prices of the United
States and Europe.
* The 10-year JGB yield dropped 2 basis
points to 0.845 percent, while 10-year JGB futures
added 0.29 point to 142.25 by the end of morning trade.
* The superlong tenor also showed strength, with the 20-year
yield down 1.5 basis points at 1.695 percent.
* The two-year yield was flat at 0.140 percent
as the Ministry of Finance offered 2.9 trillion yen of two-year
notes with a coupon of 0.2 percent.