Japan Bonds May Rise on Speculation Earthquake to Slow Economy

March 14 (Bloomberg) -- Japan’s bonds may rise for a second day on

speculation damage from the nation’s most powerful earthquake on

record will impair the economic  shop online 2011   recovery and spur demand for the refuge

of government debt.

 

Yields on benchmark 10-year bonds are likely to decline toward the

lowest level in a month as Bank of Japan policy makers meet today after

Governor Masaaki Shirakawa said he’s ready to provide "massive"

liquidity to the financial markets. The nation’s currency reached a

four-month high today amid prospects Japanese investors are

repatriating assets, raising concern a stronger yen will hurt exporters

earnings.

 

The market is more likely to focus on the downside risk to the

economy," Akito Fukunaga, chief rates strategist at the brokerage unit

of Royal Bank of Scotland Plc., wrote in a Japanese-language note

today. ‘‘We see a chance for bond yields to fall for the near term.’

 

Ten-year bond futures for June delivery last traded at 139.65 in London

on March 11, compared with 139.20 at the 3 p.m. close of the Tokyo

Stock Exchange. The contract will open for trading at 9 a.m. Tokyo

time.

 

Bonds will trade as usual starting at 8:40 a.m., according to Japan

Bond Trading Co., the nation’s largest interdealer debt broker. It

halted transactions at 2:49 p.m. in Tokyo on March 11 as the quake

shook buildings in the capital.

 

The yield on the 1.3 percent security due March 2021 fell 2.5 basis

points to 1.27 percent on March   sunglasses 2011  11. The yield reached 1.22 percent on

Feb. 24, the lowest since Feb. 2.

 

Massive’ Liquidity

 

The magnitude-8.9 earthquake on March 11 triggered a tsunami that swept

as far as 20 kilometers (12.4 miles) inland along the northern coast,

risking meltdowns at two nuclear power reactors. Chief Cabinet

Secretary Yukio Edano said the government would use 200 billion yen

($2.4 billion) of money left over from the budget for the fiscal year

ending March 31 to start an extra spending package.

 

Shirakawa told reporters late yesterday he is ready to inject more

short-term cash into the banking system starting this morning in Tokyo,

as the BOJ seeks to ensure financial stability. Today’s decision on

policy was originally scheduled for tomorrow. The central bank said it

cut short the gathering to accelerate its response.

 

Kobe Quake

 

Liquidity from the central bank may fail to prevent yields from rising

as pressure mounts on insurance companies and Prime Minister Naoto Kan

s administration to sell bonds to pay for reconstruction.

 

‘‘Rebuilding after the Kobe quake was a significant strain on the

budget, and the cleanup and rebuilding cost is likely to be even higher

this time,” Chris Low, chief economist at FTN Financial in New York,

wrote in a research note on March 11. Yields on 10-year debt “are

likely to increase as much as 50 basis points or more over the next

year,” he wrote.

 

In the five trading days after a 6.9-magnitude earthquake struck Kobe,

western Japan, in January 1995  chanel sunglasses 2011  killing more than 6,000 people, yields

rose 8 basis points, or 0.08 percentage point, to 4.73 percent.

 
Par xmjiang3 le lundi 14 mars 2011

Commentaires

#1 Par ~Air Jordan 1 le 09.05.2011 à 09:19 top
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