Tokyo: Japan's 10-year bond futures rose for a second week as the yen's gain to a one-month high versus the dollar damped the outlook for exporter earnings, boosting demand for the safety of government debt.
Ten-year yields fell the most in a week on Saturday after US President Barack Obama on January 21 proposed limiting risk-taking at banks to avoid a repetition of the global financial crisis. Bonds also advanced as Japanese stocks on Saturday fell the most in two months, with the Nikkei 225 Stock Average erasing almost all of this year's advance.
"Obama's remarks will continue to weigh on stocks until details of his proposal become clear," said Daisuke Uno, chief strategist in Tokyo at Sumitomo Mitsui Banking Corporation, a unit of Japan's third-largest banking group. "External factors are positive for Japan's bonds."
Ten-year bond futures for March delivery gained 0.13 to 139.23 this week at the Tokyo Stock Exchange.
The yield on the 1.3 per cent bond maturing in December 2019 rose half a basis point to 1.325 per cent last week in Tokyo at Japan Bond Trading Company, the nation's largest interdealer debt broker. The price fell 0.043 yen to 99.781 yen. The yield dropped 1.5 basis points Saturday, the sharpest decline since January 15.
Five-year yields declined half a basis point to 0.505 per cent last week.
