In the Tokyo morning session, Japanese government bonds experienced a slight uptick following the Bank of Japan's summary of opinions from its September 19-20 meeting, indicating a cautious stance on raising interest rates. The central bank noted the persistent instability of financial markets and stated it would not increase rates in such an environment, stressing the importance of patiently maintaining the current accommodative financial conditions.
The yield on the 2-year Japanese government bonds dropped by 1 basis point to 0.380%, the 10-year bond yield decreased by 0.5 basis points to 0.845%, and the 20-year bond yield fell by 1 basis point to 1.655%.
During the two-day meeting that concluded on September 20, the Bank of Japan kept its monetary policy unchanged. According to the minutes from the September policy meeting, one of the nine committee members emphasized the need to closely monitor downside risks while implementing monetary policy. Another member indicated that adjustments to the current stance on monetary easing would depend on economic forecasts, highlighting the importance of the US economy and financial market conditions due to their ongoing instability.
Some opinions within the committee suggest that the Bank of Japan has time to observe financial markets and the global economy before taking further policy action. One member pointed out the need for more cautious communication when considering future rate hikes, with some viewpoints advocating for improved communication strategies.
JGB
