Japanese bonds slightly gain after BoJ cuts inflation forecasts, keeps monetary policy unchanged  

Japanese bonds slightly gained Tuesday after the Bank of Japan cut its inflation growth forecasts for the coming fiscal years, while holding its monetary policy steady, even as its peers in the U.S. and Europe begin to wind down stimulus.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1/2 basis point to 0.065 percent, the yield on long-term 30-year also slipped 1/2 basis point to 0.867 percent and the yield on short-term 2-year traded nearly 1 basis point lower at -0.158 percent by 04:05 GMT.

The central bank said in a statement after its two-day meeting that it is maintaining the short-term interest rate at minus 0.1 percent and the target for the 10-year government bond yield at zero percent. Governor Haruhiko Kuroda will hold a news conference at 3:30 p.m. local time (0630 GMT) to explain the policy decision.

In an outlook report accompanying the latest monetary policy statement, the BOJ said it is maintaining its forecast for inflation to hit 2 percent in the fiscal year 2019/2020. But it now expects core consumer prices to grow 0.8 percent in the fiscal year 2017/2018, lower than the previous projection of 1.1 percent.

Apart from the BoJ's policy decision, markets now look ahead to the November FOMC statement on Wednesday, in which it is widely expected to deliver no change in the overnight rate.

Meanwhile, Japan’s Nikkei 225 traded 0.16 percent down at 21,976 by 04:10, while at 04:00GMT, the FxWirePro's Hourly Yen Strength Index remained neutral at 65.52 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest