JGB yields close lower following investors’ risk aversion, BoJ’s bond-buying operation

The Japanese government bond yields closed lower on Monday after investors shifted away from riskier assets towards safe-haven counterparts as Tokyo shares declined amid a regular debt-purchasing operation conducted by the Bank of Japan (BoJ) that gave a further lift to the market.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, slumped 4-1/2 basis points to -0.046 percent, the yield on the long-term 30-year slipped 1 basis point to 0.534 percent and the yield on short-term 2-year plunged 16 basis points to -0.159 percent by 06:40GMT.

Longer-dated JGBs benefited as the central bank today offered to buy JPY230 billion ($2 billion) of 10- to 40-year bonds at a regular operation.

"The DXY may attempt to surface above the 97.50 handle this week, especially if the ECB meeting and FOMC minutes on Wednesday continue to weigh on the Index. To this end, we are heavy on the EUR-USD, supportive towards USD-JPY, while ranging the cyclicals. On the calendar, China March CPI/PPI readings on Thursday, March trade numbers on Friday, and March monetary/lending aggregates (sometime this week) may give further cues for the cyclicals," OCBC Treasury Research commented in its Daily Market Outlook.

Meanwhile, the Nikkei 225 index closed tad lower at 21,761.65, while at 06:00GMT, the FxWirePro's Hourly JPY Strength Index remained neutral at -48.87 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex