JGBs trade nearly flat in subdued session; January monetary policy meeting minutes in focus

Japanese government bonds traded nearly flat on Monday in subdued session as investors await the Bank of Japan’s (BoJ) January monetary policy meeting minutes scheduled for Tuesday.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, traded flat at 0.05 percent, the yield on the long-term 30-year note remained steady at 0.76 percent and the yield on short-term 2-year traded 1/2 basis point higher at -0.15 percent by 04:30 GMT.

The Bank of Japan in its daily open market operation held today bought JPY450 billion of to 5-10 year JGBs, JPY190 billion worth of bonds of 10-25 years of maturity and JPY70 billion worth of bonds of over 25 years of maturity.

Moreover, the Treasury market showed no reaction as Japanese Prime Minister Shinzo Abe and Finance Minister Aso Taro came under renewed fire over suspicions of cronyism involving the sale of state-owned land.

In the United States, Treasuries saw downward pressure across the curve following the February employment report that revealed a 313K increase in non-farm payrolls, alongside an unchanged unemployment rate of 4.1 percent. By most measures, this report was granted the status of better than expected. However, a meager 0.1 percent m/m increase in average hourly earnings was enough to dampen expectations for a more aggressive policy response from the FOMC.

Meanwhile, the Nikkei 225 index traded 1.16 percent higher at 21,718.50 by 04:30 GMT, while at 04:00GMT, the FxWirePro's Hourly JPY Strength Index remained highly bearish at -103.19 (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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