JGBs rise as Treasuries climb, Nikkei erases gains

(Reuters) - Bond investors watched movements in the Tokyo stock market
closely this week as they believe the Bank of Japan will take
recent volatility in equities into account when it decides
whether to raise interest rates at its Aug. 22-23 policy meeting.




"The JGB market will stay under the strong influence of
external factors as the BOJ is unlikely to lift interest rates
before investor risk aversion ends," said Naomi Hasegawa, a
senior fixed-income strategist at Mitsubishi UFJ Securities.


Read more at Reuters.com Bonds News

UPDATE 2-MUFG, Mizuho post Q1 falls, stick to forecasts

(Reuters) - Although Japan's large banks are beginning to see some
benefit from rising interest rates, slack corporate demand for
credit and fierce competition have kept a lid on how much they
can charge borrowers.




The Bank of Japan began raising rates from zero last year,
ending more than half a decade of essentially free money.
Investors having been betting those rises will allow banks to
charge more for loans, even as they hold down the return paid to
depositors.


Read more at Reuters.com Market News

Japan's Government Bonds May Rise on Concern Stocks to Decline on Election

(Bloomberg) -- Japan's bonds may advance for a
fourth day after the ruling coalition of Prime Minister Shinzo
Abe lost its upper house majority at elections, fueling
speculation that stocks will drop and spur demand for debt.

Benchmark bond yields, which move opposite to prices, are
also likely to extend their slide past an eight-week low after
the election results increased speculation the Bank of Japan
will hold off raising interest rates next month.


Read more at Bloomberg Bonds News

Yen under pressure after BOJ vote, eye on Fukui

(Reuters) - The yen was under pressure on Thursday, staying close to an all-time low against the euro after the Bank of Japan held interest rates unchanged at 0.5 percent as expected but did so on a split vote.

The dollar was little changed after recovering from a brief sell-off, and it stayed near a record low against the euro and a 26-year trough versus sterling.


Read more at Reuters Africa

UPDATE 2-Japan machine orders rise, capex seen solid

(Reuters) - TOKYO, July 9 - Japan's core private-sector
machinery orders rose more than expected in May, pointing to
solid corporate capital spending and bolstering the case for a
Bank of Japan rate hike in August.




Core orders, which exclude those for ships and machinery at
electric power firms, rose 5.9 percent from April, Cabinet Office
data showed on Monday, beating a market consensus forecast for a
2.3 percent rise and following a 2.2 percent increase in April.


Read more at Reuters.com Economic News

JGBs down, hit by weak Treasuries, 10-year sale

(Reuters) - Traders said they were looking at the U.S. bond market for
direction as JGB prices were expected to move in narrow ranges
ahead of next week's policy meeting by the Bank of Japan, having
digested key data, the auction and speeches by BOJ officials.




"Sluggish demand for the new 10-year issue has weighed on
sentiment, at least in that sector, as the paper is seen as
expensive relative to other maturities," said Kenro Kawano, a
fixed income strategist at Credit Suisse.
The 10-year JGB sale on Tuesday drew lower-than-expected
demand from dealers despite a 1.9 percent coupon, which was the
highest since August, because dealers had wanted a re-opening of
the No. 286 1.8 percent issue to ease their shortage in the repo
market.


Read more at Reuters.com Bonds News

UPDATE 1-Japan consumer prices edge down as expected

(Reuters) - TOKYO, June 29 - Japanese core consumer prices fell
slightly as expected in in May from a year earlier, supporting
the widespread view that the Bank of Japan could raise interest
rates as early as August.




Separate data showed the jobless rate remained at a nine-year
low of 3.8 percent in May, while household spending rose 0.4
percent from the same month a year earlier, climbing for the
fifth straight month.


Read more at Reuters.com Economic News

Yen Slides Against Dollar, Euro as Fukui Signals Rates Won't Rise Quickly

(Bloomberg) -- The yen slumped the most against the
dollar since January as Bank of Japan Governor Toshihiko Fukui
said the central bank needed to be ``more confident'' about
price increases before raising rates.

Japan's currency reached an all-time low against the euro
as the yield advantage of 10-year German bunds and comparable
Japanese notes expanded to the widest in three years. Treasury
yields pulled back from five-year highs reached this week as a
government report showed core consumer inflation abated.


Read more at Bloomberg Currencies News

Yen Heads for Weekly Loss Before Bank of Japan's Interest Rate Decision

(Bloomberg) -- The yen was headed for a weekly loss
against the dollar and euro on speculation Bank of Japan
Governor Toshihiko Fukui will signal today he plans to raise
interest rates gradually.

The yen traded near a 4 1/2 year low against the dollar as
the lowest borrowing costs in the industrialized world spur
investors to take out loans in Japan and buy higher-yielding
assets elsewhere. Fukui will speak today after policy makers
conclude a two-day meeting. All 43 economists surveyed by
Bloomberg forecast they will keep the benchmark rate at 0.5
percent.


Read more at Bloomberg Currencies News

RPT-BOJ starts policy meeting, rates seen on hold

(Reuters) - TOKYO, June 14 - The Bank of Japan looks set to
maintain interest rates unchanged at a two-day policy meeting
that started on Thursday, wanting to wait a while longer to see
if the economy has improved enough to withstand a rate hike.




Financial markets already see a rate hike by September as a
done deal, and will closely scrutinise comments by the bank's
governor, Toshihiko Fukui, for hints on how soon it will happen.


Read more at Reuters.com Bonds News

BOJ starts policy meeting, rates seen on hold

(Reuters) - TOKYO, June 14 - The Bank of Japan looks set to
maintain interest rates unchanged at a two-day policy meeting
that started on Thursday, wanting to wait a while longer to see
if the economy has improved enough to withstand a rate hike.




Financial markets already see a rate hike by September as a
done deal, and will closely scrutinise comments by the bank's
governor, Toshihiko Fukui, for hints on how soon it will happen.


Read more at Reuters.com Bonds News

UPDATE 1-Japan May wholesale prices up, rises spreading

(Reuters) - TOKYO, June 12 - Japanese wholesale prices rose
slightly more than expected in May from a year earlier, with
gains spreading to more products, reaffirming expectations of an
interest rate hike in the third quarter, most likely in August.




Data from the Bank of Japan showed on Tuesday that the
corporate goods price index, which tracks trends in wholesale
prices, rose 2.2 percent in May from a year earlier, just above
economists' median forecast of a 2.1 percent rise.


Read more at Reuters.com Economic News

JGB futures down but hold above 10-month low

(Reuters) - JGBs have been sold off since late May amid a steady rise in
yields on euro zone government bonds and U.S. Treasuries, and as
solid Japanese data reinforced the view that the Bank of Japan
could hike rates as early as August.




After the two-year yield scaled a 10-year high above 1
percent and the five-year yield hit an 11-month high, traders
said they were looking at stock markets and global yields for
clues on whether these maturities, which are most sensitive to
monetary policy changes, could be sold further.


Read more at Reuters.com Bonds News

Japan's Five-Year Notes Little Changed; Report Signals More Export Demand

(Bloomberg) -- Japanese five-year notes were little
changed after a report showed U.S. service industries grew at the
fastest pace in more than a year, adding to optimism exports will
help sustain Japan's economic expansion.

Debt in Japan may follow a slump in Treasuries that yesterday
pushed two-year U.S. yields to the highest since August. Japan's
two-year yields climbed to 1 percent today for the first time in a
decade on speculation signs of faster global growth will prompt
the Bank of Japan to increase borrowing costs.


Read more at Bloomberg Bonds News

Japan's Five-Year Notes Fall; Yields Rise to 11-Month High as Stocks Gain

(Bloomberg) -- Japan's government notes fell,
pushing five-year yields to the highest in 11 months, on
speculation a gain in share prices will cut demand for debt.

Yields on five-year notes have climbed faster than those on
10-year securities since the start of last month on increasing
concern the Bank of Japan will raise borrowing costs again this
year. The Nikkei 225 Stock Average advanced for a fourth day,
the longest stretch since March.


Read more at Bloomberg Bonds News

Japan's Five-Year Government Notes Drop, Have Worst Month Since March 2006

(Bloomberg) -- Japan's five-year government notes had
the biggest monthly decline in more than a year on speculation
advancing stocks will back the case for the central bank to raise
interest rates this year.

Government reports this week showed the jobless rate dropped
to a nine-year low and households increased spending for a fourth
month. Bank of Japan policy board member Kiyohiko Nishimura said
the market ``appears to be factoring in future rate adjustments
in a gradual manner.'' Yields on two-year notes climbed to the
highest in almost a decade as the Nikkei 225 Stock Average rose
to a three-month high.


Read more at Bloomberg Bonds News

Japanese 10-Year Bond Yield at Highest Since February as Stocks Rebound

(Bloomberg) -- Japan's 10-year bond yields held near
the highest since February after the Nikkei 225 Stock Average
rebounded from the biggest decline in a month.

Two-year yields were at the highest since 1997 before reports
this week that are forecast to show Japanese industrial production
rose and U.S. hiring increased. Signs of faster growth in the
world's two biggest economies may encourage the Bank of Japan to
raise interest rates again this year.


Read more at Bloomberg Bonds News

Japan bank shares rise 4 pct on Mizuho results

(Reuters) - Sector share prices had slumped by a quarter since hitting a
seven-year peak last April, as the Bank of Japan's first rate
increase in more than half a decade failed to generate a
predicted revenue surge.




Mizuho reported a narrower-than-expected 4.4 percent decline
in annual net profit on Tuesday. Losses at a major borrower had
forced it to boost reserves against a potential default, but the
damage was smaller than forecast and was partly offset by a gain
in lending income.


Read more at Reuters.com Market News

Yen Trades Near Record Low Against Euro Before Bank of Japan's Minutes

(Bloomberg) -- The yen traded near a record low
against the euro as minutes from a Bank of Japan meeting last
month may show the central bank will keep interest rates
unchanged for some time.

Japan's currency yesterday also reached the lowest in three
months versus the dollar as investors used the country's 0.5
percent borrowing costs for yen loans to buy assets at Europe's
3.75 percent or the 5.25 percent U.S. rate. Yield spreads are
unlikely to narrow after policy makers cut Japan's inflation
forecast to near zero percent on April 26-27.


Read more at Bloomberg Currencies News

South Korean Won Reverses Gains as Investors May Sell to Fund Yen Demand

(Bloomberg) -- South Korea's won reversed a gain to the strongest since January on speculation investors sold the currency to fund purchases of the yen, which rose to a two-week high against the dollar.

Fund managers have been borrowing yen at Japan's lower interest rates to invest in higher-yielding assets abroad, in so- called carry trades. Speculation the Bank of Japan will raise interest rates may have prompted traders to reverse such investments, requiring them to sell the won.


Read more at Bloomberg Currencies News