JGBs narrowly mixed ahead of BoJ’s policy decision; major Asian markets shut for Lunar New Year holiday

The Japanese government bonds traded narrowly mixed Monday ahead of the Bank of Japan’s (BoJ) 2-day monetary policy meeting decision, scheduled to be revealed on Tuesday. Also, investors remain sidelined in any major trading activity, following closure of major Asian markets on account of Lunar New Year holidays.

The benchmark 10-year bond yield, which moves inversely to its price, hovered around 0.08 percent, while the long-term 30-year bond yields fell nearly 1/2 basis point to 0.85 percent and the yield on the short-term 2-year note also dipped 1-1/2 basis points to -0.21 percent by 06:50 GMT.

The Bank of Japan (BoJ) in its November 1 monetary policy meeting mentioned its optimism over the growth of the economy, with a moderate rate of recovery observed in the global demand. The central bank is expected to maintain an easing bias, but shall not remain compelled to ease in the medium term.

Japan’s December retail sales fell wider than market expectations, by -1.7 percent m/m, a reversal from +0.2 percent in November. However, it rose +0.6 percent y/y, down from prior +1.7 percent y/y.

Meanwhile, Japan’s Nikkei 225 closed 0.54 percent lower at 19,363 while at 7:00GMT, the FxWirePro's Hourly Yen Strength Index remained slightly bearish at -87.66 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex