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JGBs flat in muted trading session ahead of BoJ’s policy meeting early next week

Japanese government bonds remained flat in muted trading session Friday as investors are curiously eyeing the Bank of Japan’s (BoJ) monetary policy decision, scheduled to be held early next week for further detailed insight into the debt market.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.08 percent, the yield on the long-term 30-year note edged nearly 1/2 basis point lower at 0.84 percent and the yield on short-term 2-year traded nearly flat at -0.13 percent by 05:25 GMT.

The Bank of Japan (BoJ) is expected to maintain its 'QQE with yield curve control' policy unchanged at the next monetary policy meeting ending on Tuesday, January 23. Governor Kuroda is likely to downplay the significance of daily market operations and repeat BoJ's commitment to the current yield curve control.

Bloomberg in its last report said a small shift is taking place in internal discussions among BoJ policymakers, with a minority raising the need to eventually start discussing policy normalization, even though they agree the current stimulus program must continue unchanged for some time, according to people familiar with talks at the central bank.

On the contrary, BoJ Governor Haruhiko Kuroda in its latest speech reiterated the central bank’s resolve to maintain quantitative easing, but his positive comments on inflation and the economy sent the yen to a four-month high versus the dollar. Kuroda also added that the BoJ will continue its aggressive easing, composed of yield curve control and a massive asset-buying program, for as long as needed to achieve its price target.

Meanwhile, the Nikkei 225 index traded 0.11 percent higher at 23,790.00 by 05:35 GMT, while at 05:00GMT, the FxWirePro's Hourly JPY Strength Index remained slightly bearish at -99.00 (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

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October 23 19:00 UTC Released

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