January 17, 2014 / 2:47 AM / 4 years ago

JGB prices narrowly mixed in thin trading

2 Min Read

TOKYO, Jan 17 (IFR) - Japanese government bond prices were mixed on Friday, with domestic real money accounts remaining largely sidelined amid a lack of purchases by the Bank of Japan in the secondary market.

The BOJ holds off on JGB purchases under its massive bond-buying programme when the Ministry of Finance conducts JGB auctions on the same day.

The ministry is to sell 300 billion yen ($2.9 billion) in off-the-run 20-, 30- and 40-year JGBs to improve liquidity at the long end of the yield curve.

The 10-year yield was down 0.5 basis point at 0.665 percent, not far from a near one-month low of 0.650 percent set on Jan. 14. Ten-year JGB futures gained 9 ticks to 144.27.

"With the yen appreciation and U.S. bond market gains following last week's U.S. employment report failing to take hold as a trend, the decline in JGB yields also appears to be running its course," Barclays analysts wrote in a note.

"For now, we believe the market is likely to view levels near 0.65 percent as the lower bound for 10-year yields."

The 30-year yield added 0.5 basis point to 1.690 percent, while the 20-year yield was not quoted.

Earlier, Japan raised its assessment on the overall economy for the first time in four months, reflecting solid private consumption and improving capital expenditure, indicating that the country's economic recovery is on a more solid footing.

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