HALISTER1: Japan 30-Yr Auction Sees Strong Demand on Redemption: BofAML

Japan 30-Yr Auction Sees Strong Demand on Redemption: BofAML

(Bloomberg) -- Auction of 30-year JGB draws strong demand as investors want new debt due to large bond redemptions this month, says Shuichi Ohsaki, chief Japan rates strategist at BofAML.
  • Demand may be mostly from dealers; they may be building sovereign bond stocks for reinvesting from redemption, says Tokyo-based Ohsaki by phone
  • NOTE: JGBs worth about 18t yen ($165b) will mature this month (excluding T-bills, linkers and floating bond), with large proportion of them due June 20, according to data compiled by Bloomberg
  • 30-year yield is -1bp to 0.280%
  • 20-year yield touches 0.220%, matching historic low marked on May 9 on strong 30-year JGB auction
  • 10-year yield up 0.5 bp to -0.120% following higher U.S. Treasury yield
  • NOTE: 30-year bond auction draws strongest demand in 3 months
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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Shuichi Ohsaki (Merrill Lynch Japan Securities Co Ltd)

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