Japanese govt bond prices end morning lower before auction of two-year bonds |
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Tue, 30 Jan 2007 04:23
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TOKYO (XFN-ASIA) - Japanese government bond prices ended the morning session mostly lower because of caution among investors as they awaited the results of today's auction of two-year government bonds, with the economic data that were released this morning having failed to inspire activity, dealers said.At the break, the yield on on the benchmark 10-year bond was at 1.715 pct, up from 1.705 pct at the close yesterday.The yield on the lead five-year note was flat at 1.190 pct, while the yield on the two-year debt had advanced to 0.730 pct from 0.725 pct.The yield on the bellwether 20-year bond had edged up to 2.195 pct from 2.190 pct and the yield on the 30-year bond had climbed to 2.455 pct from 2.445 pct.Bond prices move inversely to yields.The price of the 10-year bond futures contract had fallen to 134.35 yen from 134.63 yen at the close yesterday.The Ministry of Finance said it had set a coupon of 0.8 pct on the 1.7 trln yen-worth of two-year government bonds it will auction today, unchanged from coupon on the last issue of two-year bonds, auctioned on Dec 21. At the last auction, the lowest accepted bid was 100.015 yen, giving a yield of 0.792 pct, with a bid-to-cover ratio of 3.62 to one.Lehman Brothers strategist Makoto Yamashita said: 'Sales of the two-year government bonds may not go so smoothly on the secondary market, should the market's perception about interest rates in Japan change.'The release this morning of household spending, industrial output and employment data for last month failed to induce activity on the debt market, although they further weaken the Bank of Japan's case for raising interest rates next month, dealers said.(1 usd = 121.61 yen)yasuhiko.seki@xfn.com
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Japanese govt bonds end morning mixed ahead of 5-yr bond auction, rate decision 