The Japanese government bonds edged higher on Thursday following firmness in the U.S. Treasuries. Also, investors moved to safe-haven buying following weakness in the riskier assets like equities and oil.
The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1/2 basis point to 0.042 percent, the yield on the long-term 30-year note also declined 1/2 basis point to 0.757 percent and the yield on short-term 2-year dipped nearly 1/2 basis point to -0.158 percent by 04:30 GMT.
Japan’s benchmark stocks index, Nikkei 225 traded mostly lower on Thursday as sentiments got dragged down by a slide on Wall Street. The Nikkei 225 lost 1.6 percent in early trading to 21,726.26 pressured by losses on the U.S. stocks and a larger-than-expected fall in Japanese industrial output. Also, The Bank of Japan's decision to lower buying of long-term bonds also dampened sentiment by boosting the yen.
In the United States, Treasuries pushed higher across much of the curve, despite little overall change in the short-end of the curve during a relatively quiet session, marked largely by a string of lackluster economic releases.
Markets now look ahead to a greater flow of data on Thursday, highlighted by personal income/spending, ISM manufacturing, construction spending, jobless claims and vehicle sales releases. However, greater focus will likely be paid to Federal Reserve Chair Jerome Powell's appearance before the Senate Banking Committee, likely to drive home a commitment to keeping the Fed on the path of policy normalization amidst a framework of data dependence.
Meanwhile, the Nikkei 225 index traded 1.50 percent lower at 21,735.00 by 04:40 GMT, while at 04:00GMT, the FxWirePro's Hourly JPY Strength Index remained neutral at 69.18 (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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