TOKYO Jan 9 Japanese government bond prices
were largely steady on Thursday, even though Tokyo's stocks came
under pressure, while the country was to sell its second
inflation-linked bonds since 2008.
The 10-year yield edged up 0.5 basis point to
0.705 percent, while the 10-year JGB futures were
largely unchanged at 143.72.
Tokyo's Nikkei stock average dropped 1.3 percent in
relatively active trade on Thursday morning after rising sharply
on the previous day, as investors stayed risk averse before the
release of U.S. nonfarm payroll data on Friday.
The finance ministry was to sell 300 billion yen of
inflation-linked 10-year JGBs with a 0.1 percent coupon later in
This marked the second such issue since 2008. In October,
the government sold 300 billion yen of 10-year inflation-linked
JGBs with strong demand.
Japan suspended issue of inflation-linked bonds in 2008,
when the global financial crisis threw the country back into
deflation and caused massive losses on inflation-linked JGBs.
"Valuations do not look particularly cheap and seasonality
will work against the issue, but auction results should be solid
given the external environment - yen depreciation and
stronger-than-expected CPI inflation," Barclays wrote in a note,
referring to the latest offer.
The Bank of Japan aims to achieve a 2 percent inflation in
two years, when it stunned the financial markets in April by
promising to inject $1.4 trillion into the economy to spur
BOJ board member Sayuri Shirai said it may be desirable to
take more than two year to achieve the central bank's inflation
target if the burden on households and the corporate sector
proves to be excessive, according to a speech released on
The 30-year yield was down 0.5 basis point at
1.695 percent, while the 20-year yield was
unchanged at 1.535 percent.
The short-dated five-year yield inched up 0.5
basis point to 0.220 percent.