Japan 10-Yr Bond Yield Tops BOJ Policy Ceiling despite Bond-Buying Announcement

Reuters

11:47 JST, January 16, 2023

TOKYO (Reuters) — Japan’s 10-year government bond yield rose above the Bank of Japan’s policy ceiling on Monday, despite the bank’s announcement it would conduct bond buying operations, which include offers to buy unlimited amounts of shorter-term notes.

The 10-year JGB yield JP10YTN=JBTC rose 1 basis point to 0.510%, topping the 0.5% ceiling of the BOJ’s policy band.

Yields across the curve were under upward pressure ahead of this week’s BOJ policy meeting, at which some investors expect a further tweak in the bank’s ultra-loose interest rate policy.

In a surprise move last month, the BOJ widened the band for the 10-year bond yield to 0.5 percentage points up and down from its 0% target.

Yields at the super-long end fell, with the 30-year JGB yield JP30YTN=JBTC down 5 basis points to 1.560%, its lowest level since Dec. 27.

Yields on 20-year bonds JP20YTN=JBTC slipped 4 basis points to 1.345%.