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JGBs narrowly mixed ahead of 40-year bond auction
May 21, 2013 / 2:15 AM / 5 years ago

JGBs narrowly mixed ahead of 40-year bond auction

TOKYO, May 21 (Reuters) - Japanese government bond prices were narrowly mixed on Tuesday as traders braced for an auction of 40-year bonds later in the day, while the market remained fragile as Japan’s aggressive stimulus has boosted share prices.

* The Ministry of Finance offered 400 billion yen ($3.9 billion) of 40-year JGBs, the longest maturity the ministry currently offers. The auction result will be announced at 12:45 p.m. (0345 GMT).

* Market players do not expect strong demand give recent weakness in the market, sparked by the Bank of Japan’s aggressive monetary easing.

* BOJ Governor Haruhiko Kuroda did little to soothe bond investors on Monday, when he said it was natural for long-term bond yields to rise as inflation expectations pick up.

* “I think the auction will likely be soft. The market is still in a difficult position,” said Katsutoshi Inadome, fixed income strategist at Mitsubishi UFJ Morgan Stanley Securities.

* The yield on the current 10-year cash bonds rose 0.5 basis point to 0.850 percent. It hit a one-year high of 0.920 percent last week.

* The 30-year bond yield was flat at 1.820 percent , though it had risen to 1.830 percent at one stage, its highest level in almost three months.

* The benchmark 10-year JGB futures rose 0.01 point to 142.13.

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