TOKYO Feb 28 The benchmark Japanese government
bond yield held close to a 10-year low on Thursday as the
government nominated dovish candidates to helm policy at the
Bank of Japan, while superlong maturities outperformed on
* The government of Prime Minister Shinzo Abe tapped Asian
Development Bank President Haruhiko Kuroda to be BOJ governor
after current governor Masaaki Shirakawa steps down on March 19,
and nominated academic Kikuo Iwata and BOJ official Hiroshi
Nakaso as deputy governors.
Kuroda supports increased purchases of government bonds, and
has suggested two years as an appropriate timeframe for the BOJ
to meet its 2 percent inflation target.
* The 10-year yield was flat at 0.665
percent, its lowest since June 2003 after dropping for five
* Ten-year JGB futures ended morning trade at their
session high of 145.04, up 0.05 point at their highest since
* JGBs have benefited from expectations that Shirakawa's
successor will implement aggressive monetary easing, but some
strategists fear the bond market has priced in too much, too
* "It's all on expectations, with nothing concrete just yet.
It's very difficult to justify this kind of market movement,"
said Shogo Fujita, chief Japan bond strategist at Bank of
America Merrill Lynch.
* Superlong bonds outperformed on month-end demand. Funds
often buy longer-term debt at the end of a month to extend the
duration of their portfolios.
The 30-year yield shed 1.5 basis points to
1.835 percent, its lowest since Aug. 23, and the 20-year yield
dipped 2 basis points to 1.630 percent, its
lowest since Aug. 15.
* The five-year yield crept up half a basis
point to 0.120 percent from a record low of 0.115 percent.
* The two-year note was untraded, with its yield
last at 0.04 percent, as the Ministry of Finance
offered 2.7 trillion yen ($29.5 billion) of that maturity.
The sale was expected to proceed smoothly as it has in
recent months, as the BOJ now buys most of the new issuance in