JGBs flat post higher-than-expected June industrial production

The Japanese government bonds traded flat Tuesday after the country’s industrial production for the month of June, released today, came in higher than what markets had initially anticipated.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.05 percent, the yield on long-term 30-year note traded flat at 0.85 percent and the yield on short-term 2-year also remained steady at -0.11 percent by 05:40 GMT.

Japan's industrial production rebounded more than initially estimated in June, final data from the Ministry of Economy, Trade and Industry showed Tuesday. Industrial production climbed a seasonally adjusted 2.2 percent m/m in June instead of a 1.6 percent rise reported earlier. This was followed by a 3.6 percent decline in May.

The monthly growth in shipments was revised up to 2.5 percent from 2.3 percent. Inventories fell 2.0 percent, slower than the 2.2 percent decrease seen in the flash data. On a yearly basis, industrial production growth moderated to 5.5 percent in June from 6.5 percent a month ago. Data also showed that the capacity utilization rate rose 2.1 percent monthly in June, in contrast to a 4.1 percent fall in May.

Meanwhile, Japan’s Nikkei 225 traded 1.39 percent higher at 19,809.50 by 05:40GMT, while at 05:00GMT, the FxWirePro's Hourly Yen Strength Index remained highly bearish at -111.14 (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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