Japanese government bond yields steady after solid 30-year auction
TLT•Japanese government bond yields fell after a 30-year auction drew stronger demand than in September, with the bid-to-cover ratio rising to 3.88 from 3.79. The 10-year yield declined 3 basis points to 3.075%, and the 30-year yield fell 3.5 basis points to 4.175%.
1. Auction draws stronger demand
Japanese government bond yields fell on Thursday after a 30-year auction showed stronger demand than the previous month. The bid-to-cover ratio was 3.88, up from September’s 3.79, while the auction tail narrowed to 0.16 from 0.28.
2. Yields decline across maturities
The benchmark 10-year yield fell 3 basis points to 3.075%, and the 30-year yield declined 3.5 basis points to 4.175%. The two-year yield decreased 1.5 basis points to 1.93%, the five-year yield fell 2.5 basis points to 2.385%, and the 20-year yield slid 3.5 basis points to 3.945%. A strategist said the result could be viewed as somewhat firm because there had been no auction concession.
3. Investors watch rate outlook
Market participants remained wary of French and Italian debt markets and focused on the path of central bank policy. Expectations for another Bank of Japan rate hike have shifted toward December; sources said the BOJ may hold rates in October but offer hawkish hints. The 30-year yield had reached a record 4.25% on Monday.
