JGB yield slump in muted trading as investors await BoJ’s monetary policy decision

The Japanese government bond yields slumped at the end of Asian session Monday, amid a muted trading week that is scheduled to witness data of no major economic significance ahead of the Bank of Japan’s (BoJ) 2-day monetary policy meeting, which is due to be concluded on March 15 for further direction in the debt market.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, slumped nearly 3-1/2 basis points to -0.032 percent, the yield on the long-term 30-year remained tad lower at 0.581 percent and the yield on short-term 2-year plunged nearly 14-1/2 basis points to -0.143 percent by 06:30GMT.

Fed chair Powell opined that the “US outlook is a positive one” and “we’ll be looking at a range of data” from here, but reiterated “our policy rate we think is in an appropriate place”, OCBC Treasury Research reported.

Separately, doubts have emerged if Trump and Xi will meet later this month, notwithstanding positive noises about an impending bilateral trade deal. Wall Street and the USD closed lower on Friday, with the 10-year UST bond yield at 2.63 percent, the report added.

Lastly, according to a report from Reuters, "The Bank of Japan will likely maintain its view the export-reliant economy is expanding moderately but warn of heightening overseas risks at next week’s rate review, sources say, as China’s slowdown and trade tension cloud the outlook."

Meanwhile, the Nikkei 225 index closed tad higher at 21,105.50, while at 06:00GMT, the FxWirePro's Hourly JPY Strength Index remained highly bullish at 102.55 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex