2023-10-20 06:48:53
The headquarters of the Bank of Japan in Tokyo
par Brigid Riley et Kevin Buckland
The Bank of Japan (BoJ) intervened on Friday in the Japanese government bond (JGB) market, with the Japanese ten-year yield having reached its highest level in ten years at the start of trading in Asia, driven by the rise in US Treasury bond rates.
The yield on the ten-year JGB thus rose at the start of the session to 0.845%, its highest level since July 2013, following having already increased the day before by 3.5 basis points, to 0.840%, investors betting on an abandonment of the BoJ’s negative rate policy while the Japanese central bank for its part is trying to curb market expectations by stabilizing the evolution of yields.
The Bank of Japan announced its intention to extend five-year bonds once morest collateral to financial institutions.
“The BOJ is not trying to cap yields,” said Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui DS Asset Management. “It sends a signal that movements must be gradual and not rapid,” he added.
The ten-year JGB yield fell to 0.835% following the BoJ announcements. The two-year rate remained stable at 0.075%, while the five-year rate lost 0.5 basis points, to 0.365%.
On long rates, the yield on the 20-year JGB rose two basis points, to 1.635%, its highest level since September 2013.
The rise in JGB yields follows that of their American equivalents, with the 10-year Treasuries rate having crossed the 5.0% mark on Thursday, a first since July 20, 2007.
(Reporting Brigid Riley and Kevin Buckland, French version Claude Chendjou, edited by Jean-Stéphane Brosse)
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