JGBs trade mixed in muted session; BoJ monetary policy decision in focus early next week

The Japanese government bonds remained mixed on the last trading day of the week as investors defied movements amid a muted session that witnessed data of little economic significance. Also, markets will remain glued to watch the Bank of Japan’s (BoJ) monetary policy decision, scheduled to be unveiled on October 31.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, rose a little above 1/2 basis point to 0.07 percent, the yield on long-term 30-year hovered around 0.87 percent while the yield on short-term 1-year traded tad lower at -0.14 percent by 03:50 GMT.

US Treasury yields inched higher on Thursday in choppy trading, undermined by a soft auction of US 7-year notes which saw demand at its weakest since August last year. The US 7-year note was sold at 2.280 percent, higher than the expected yield at the bid deadline. The yield was the highest seen at an auction for this debt maturity since January.

A report from Politico, meanwhile, saying that current Federal Reserve Chair Janet Yellen was out of the running for the top U.S. central bank job briefly nudged rates higher. The other two contenders for the Fed job are Stanford University economist John Taylor, and current Fed Governor Jerome Powell. Both are viewed as more hawkish than Yellen.

Meanwhile, Japan’s Nikkei 225 jumped 1.13 percent to 21,985.50 by 03:55GMT, while at 03:00GMT, the FxWirePro's Hourly Yen Strength Index remained neutral at 38.99 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex     

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