JGBs continue flat trading after BoJ’s CPI index remains tad higher; eyes on October retail sales data

The Japanese government bonds traded flat during Asian session Tuesday as well after the Bank of Japan’s (BoJ) core consumer price inflation (CPI) index remained tad higher on a y/y basis, ahead of the country’s retail sales and industrial production data for the month of October, scheduled to be released on November 28 and 29 respectively by 23:50GMT.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, remained flat at 0.090 percent, the yield on the long-term 30-year note hovered around 0.815 percent while the yield on short-term 2-year fell to -0.139 percent, from yesterday’s 0.143 percent by 05:30GMT.

Wall Street bounced overnight as tech stocks made a comeback, whilst UST bond yields rose, the USD held on to gains and crude oil prices (WTI) regained the USD51 per barrel handle amid a firmer risk appetite post-holidays, albeit Bitcoin slid further below USD4,000.

That said, US president Trump warned in a WSJ interview that he would likely proceed with plans to hike tariffs on USD200 billion of China imports and is prepared to impose tariffs on the remaining USD267 billion if there is no deal at the November 30 meeting.

According to a recent Reuters poll, Japan’s industrial output likely rebounded in October after the previous month’s drop due to natural disasters, which would give encouragement that the economy could show growth this quarter. Further, retail sales probably grew at faster annual pace than in September, reflecting a tight labor market and gradual wage growth, it showed.

Meanwhile, the Nikkei 225 index traded 0.91 higher at 21,994.50 by 05:35GMT, while at 05:00GMT, the FxWirePro's Hourly JPY Strength Index remained neutral at -72.70 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex