TOKYO Dec 10 Japanese government bond prices
edged higher on Tuesday, with the longer-dated sectors
underperforming ahead of an auction of 30-year debt later in the
The Ministry of Finance was to sell 600 billion yen ($5.8
billion) worth of 30-year JGBs on Tuesday.
Yields on existing 30-year JGBs rose 1.5
basis points to 1.685 percent, while the 20-year yield
was up 2 basis points at 1.520 percent.
"Thirty-year yields have exceeded 1.65 percent, their
highest level at auction time since September. Given the trend
of the past several months, this should be an adequate level for
dip-buying," Barclays Capital said in a note.
But analysts from Morgan Stanley MUFG said they continued to
recommend going short the 30-year sector, saying it expected the
long-end of the yield curve to face steepening pressure as the
Bank of Japan's efforts to achieve a 2 percent inflation target
push up forward long-term rates.
The BOJ stunned the financial markets on April 4, promising
to inject $1.4 trillion into the world's third-largest economy
in less than two years.
The 10-year JGB yield added 1 basis point to
0.665 percent. So far this year, the benchmark yield has fallen
13 basis points, heading for a fourth straight year of decline.
Ten-year JGB futures dipped 4 ticks to 144.67.
The five-year yield inched up 0.5 basis point
to 0.195 percent, though not too far from a 7-1/2-month low of
0.180 touched late last month.
Earlier, a government survey showed large Japanese
manufacturers grew less optimistic about business conditions in
October-December, in a sign that domestic demand may be