The 10-year JGB yield was unchanged at 0.500%, while government bonds maturing in March 2032 rose to as high as 0.597%, their highest level since Jan. 16. "Yields on most recently issued 10-year JGBs are contained through the BOJ's daily operations," said Masayuki Koguchi, general manager at the fixed income investment division of Mitsubishi UFJ Kokusai Asset Management. "But yields on other 10-year notes are under upward pressure ahead of the BOJ's policy meeting this week."
The BOJ is expected to maintain ultra-low interest rates, including its controversial bond yield cap, on Friday as it awaits a leadership transition that could eventually end outgoing chief Haruhiko Kuroda's massive monetary stimulus.
Yields on super-long notes rose after a weak outcome of an auction for the 30-year notes.
The auction received bids worth 3.00 times the amount sold, lower than a ratio of 3.32 times at the previous auction, with the tail, or the gap between lowest and average price, widening 0.19 points from 0.15 points.
The 30-year JGB yield rose 1 basis point (bp) to 1.420% and the 20-year JGB yield rose 0.5 bp to 1.235%. The 40-year JGB yield rose 1 bp to 1.610%.
The two-year JGBs have not been traded as of 0530 GMT and the yield stayed -0.045%. The five-year yield fell 0.5 bp to 0.200%. (Reporting by Junko Fujita; Editing by Kim Coghill)
