HALISTER1: JGB 10-Year Auction May Have Negative Yields: Deutsche

JGB 10-Year Auction May Have Negative Yields: Deutsche

(Bloomberg) -- Today’s auction of 10-year JGBs may have a coupon of 0.1% and negative yields, Makoto Yamashita, chief Japan interest rate strategist at Deutsche Securities, writes in a research note today.
  • Says, however, buying from brokers and overseas investors may not be sufficient to offset expected weak demand from banks
  • Adds domestic investors are unlikely to take on risk aggressively ahead of March-end of Japan’s fiscal year
  • Given supply-demand conditions are tight in JGB market, there’s a risk that yields will whipsaw in short term
  • JGB 10-year yield up 0.5 bp to -0.060% in secondary market
  • NOTE: 10-year JGB yield traded at -0.04% on Feb. 29 in when- issued transactions, according to Japan Securities Dealers Association data; avg auction yield has never fallen below zero, based on Bloomberg data going back to 1989
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Makoto Yamashita (Deutsche Bank AG)

To de-activate this alert, click here

UUID: 7947283