JGBs jump at close tracking U.S. Treasuries, BoJ’s bond-buying operation

The Japanese government bonds jumped at the time of closing Wednesday tracking a similar movement in the United States Treasuries amid a regular bond-buying operation conducted by the Bank of Japan (BoJ) earlier today.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, hovered around -0.029 percent, the yield on the long-term 30-year slipped 1/2 basis point to 0.575 percent and the yield on short-term 2-year remained flat at -0.149 percent by 06:35GMT.

The BoJ conducted a regular JGB buying operation on Wednesday, offering to purchase 160 billion yen ($1.43 billion) of 10- to 25-year bonds and 40 billion yen of 25- to 40-year debt. The central bank left both purchase amounts unchanged from the previous operation it conducted for the maturities on April 19, Reuters reported.

The U.S. yield curve steepened to just a tenth of a basis point below this year’s high during overnight session Tuesday, as investors remained bullish following strong U.S. company earnings that pushed the S&P 500 index toward record highs.

Lastly, the short-term 2-year auction yesternight attracted solid investors demand worth $40 billion; a 2.51 bid-to-cover ratio, 47.7 percent of the offering taken by indirect bidders, 15.8 percent by direct bidders and the remaining 36.5 percent bought by dealers.

Meanwhile, the Nikkei 225 index closed tad lower at 22,186.50, while at 06:00GMT, the FxWirePro's Hourly JPY Strength Index remained highly bullish at 123.07 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex