TOKYO, July 24 Yields on benchmark 10-year
Japanese government debt dipped on Wednesday, matching a
two-month intraday low touched in the previous session after the
Bank of Japan offered to buy more bonds as part of its stimulus
drive to revive the economy.
* Longer-maturities underperformed, ahead of the Ministry of
Finance's auction of 1.2 trillion yen ($12 billion), 20-year
bonds on Thursday, leading a steepening in the long-end of the
* The 10-year yield was down 0.5 basis point
at 0.770 percent, while 10-year JGB futures added 0.06
point to 143.76, hovering near a two-month intraday high of
143.85 hit on Tuesday.
* "We have the BOJ operations that have been more active
than before," said Maki Shimizu, senior strategist at Citigroup
in Tokyo. "When there is no major catalyst in the market, that's
when the BOJ operations have become more notable."
* The BOJ offered to buy 950 billion yen worth of JGBs with
residual maturities from one to 10 years. The Japanese central
bank stunned financial markets on April 4, promising to inject
$1.4 trillion into the economy in less than two years.
* The JGB market shrugged off further evidence of slowing
growth in China after activity in the country's manufacturing
sector slowed to an 11-month low in July as new orders faltered
and the job market darkened.
* Hurt by the slowdown in China, Japan's exports rose less
than expected last month.
* "If (China) goes into recession, that's another story. So
far we don't see heightened risk for that," Shimizu said, adding
that the market was more focused on next week's U.S. nonfarm
payrolls data, which could give further clarity on when the
Federal Reserve is likely to scale back its $85 billion a month
* The 20-year yield added 1 basis point to
1.725 percent, while the 30-year yield was up 1.5
basis points at 1.855 percent.