JGBs nearly flat after BoJ remains steady as expected; August national CPI seen to rise slightly

Japanese government bond prices remained nearly flat Wednesday after the Bank of Japan (BoJ) in its 2-day bi-monthly monetary policy meeting, kept interest rate unchanged, as was widely anticipated by market participants. Also, investors are hoping to see a slight rise in the country’s consumer price inflation (CPI) figures, due to be released on September 20 for added direction in the debt market.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, remained nearly 1/2 basis point higher at 0.118 percent, the yield on the long-term 30-year note flat at 0.851 percent and the yield on short-term 2-year hovered around -0.104 percent by 05:10GMT.

According to a report from Reuters, " The Bank of Japan and many of its overseas counterparts have been put in a tricky position as a deepening tariff row between the United States and China threatens to unsettle asset markets, disrupt supply chains and undermine their economies and policies".

The BoJ meeting came ahead of a ruling party leadership race on Thursday, which Prime Minister Shinzo Abe looks set to win and put him on track to become Japan’s longest-serving premier.

Meanwhile, the Nikkei 225 index jumped 1.23 percent to 23,721.50 by 05:20GMT, while at 05:00GMT, the FxWirePro's Hourly JPY Strength Index remained slightly bearish at -95.24 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex