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Home / Business / Yields on Japanese government bonds rise as the central bank meets

Yields on Japanese government bonds rise as the central bank meets



Monday 06:50 BST

What You Need to Know

  • Yields on Japanese government bonds rise, BoJ opens 2-day meeting
  • Global stocks slump on weak Wall Street numbers
  • 19659007] Dollar ticks higher, renminbi continues to weaken
  • oil prices tumble

Overview

Asia-Pacific equities hit negative territory during the week, while Japanese sovereigns became the focus of traders

Top Topic

Ten-year Japanese government bond yields were up 1 basis point to 0.104 percent, as the focus remained on the outcome of the Bank of Japan's two-day meeting, which began on Monday. The meeting follows a week of speculation that the bank is considering improvements to its stimulus packages. Last week's speculation showed that Japanese bond yields have made their biggest plunge in two years, forcing the central bank to apply its seldom-used intervention strategy twice.

Yoshinori Shigemi, global market strategist at JPMorgan Asset Management, said the central bank faces a dilemma It remained far from its inflation target, even though it pursued a loose growth policy.

"The lack of recovery in inflation should mean that the BoJ needs to maintain its policy, but this policy also puts pressure on the bond market, banks and financial institutions," he said. "Moving away from a loose monetary policy could be seen as a tacit admission of defeat, which would then lead to a stronger Japanese yen and a negative stock price reaction."

The 10-year US Treasury yield rose 1 basis point to 2.96 percent.

Equities

Asia-Pacific equities declined following Friday's decline in technology stocks on Wall Street. The Japanese Topix Index fell 0.3 percent, while Industrials and Technology fell 0.5 percent and 0.6 percent, respectively.

European equities are also expected to tick slip 0.5 percent for the FTSE 100 and 0.6 percent for Frankfurt's Xetra Dax 30.

Hong Kong's Hang Seng Index fell 0.7 percent after the technology segment 2.6 percent and financials by 0.4 percent.

The Hang Seng China Enterprises index of Hong Kong-listed Chinese companies returned past gains by 0.4 percent, although infrastructure stocks rose. In mainland China, the CSI 300 index, which included key Shanghai and Shenzhen-listed companies, fell 0.3 percent.

In Australia, the S & P / ASX 200 fell 0.4 percent, closing its 10-year high on Friday. All sectors where telecommunications were not allowed fell; health and technology sectors fell more than 1 percent.

The South Korean Kospi Association dropped 0.1 percent as technology stocks fell 1 percent.

On Friday, the S & P 500 and the Nasdaq Composite closed lower on Wall Street A decline in technology stocks offset price gains driven by robust US growth. The Nasdaq lost 1.5 percent and fell 20 percent for Twitter, while the S & P 500 fell 0.7 percent.

Forex

The dollar index was 0.1 percent higher at 94,724. The Japanese yen was slightly weaker against the dollar at ¥ 111.14. For European currencies, the pound sterling was trading at $ 1,3104 and the euro stable at $ 1,1653.

China's currency weakened, with the onshore renminbi down 2 percent on both sides of a daily average of the People's Bank of China declined 0.4 percent to Rmb6.8340, the lowest point since the end of June 2017. The offshore Renminbi slipped 0.4 percent to Rmb6.8428.

Commodities

Oil prices diverged, with Brent crude at $ 74.29 a barrel After a decline at the start of the session, the US dollar for West Texas Intermediate rose 0.3 percent to $ 68.91 a barrel barrel.

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