JGB Yields Stuck as COVID-19 Cases Surge to Record.

JGB Yields Stuck as COVID-19 Cases Surge to Record.

Japanese government bonds yields ended flat on Friday amid a lack of new catalysts, while a surge in domestic COVID-19 cases stirred speculation of new bond issuance to finance additional economic stimulus.


The 10-year, 20-year and 30-year JGB yields were all unchanged at 0.015%, 0.390% and 0.635%, respectively.


The 10-year yield has risen from Monday’s low of 0.005%, after dropping from a high of 0.065% touched at the end of last month.


The five-year yield rose 0.5 basis points to minus 0.125%, while the two-year paper was untraded. Benchmark 10-year JGB futures fell 0.02 points to 152.3, with a trading volume of 15,758 lots.


“Superlong bonds may have a hard time rising amid speculation about potential further economic measures to deal with the worsening coronavirus situation,” said Katsutoshi Inadome, senior bond strategist at Mitsubishi UFJ Morgan Stanley Securities.


New COVID-19 infections surged to a record of above 10,000 nationwide on Thursday, led by an unprecedented 3,865 cases in Olympics-host Tokyo.


The government on Friday proposed extending a state of emergency in Tokyo and Okinawa to Aug. 31 and expanding it to three prefectures neighbouring the capital, as well as to Osaka.

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