Tuesday, 5th October 2010
In Business In Japan,
Bond yields hit seven-year low
The market has seen Japan's government five-year bonds fall to their lowest levels in just over seven years.
It is thought that the yields have dropped because the market is expecting the Bank of Japan to announce further monetary easing to help control the country's economy.
According to a Dow Jones survey, nine out of ten economists are predicting that the central bank will aim to continue the expansion of liquidity provisions. This could be in the form of increasing the supply of six-month loans or the purchasing of short-term government bonds.
"Expectations are running ahead that the Bank of Japan will do some kind of easing," said Makoto Noji, a strategist at Tokyo-based Mizuho Securities Research & Consulting Co, reports Bloomberg.
The Bank of Japan is also likely to keep the overnight loan rate at its current 0.1 per cent rate.
Meanwhile, Asian stocks rose to their highest level in over two years as China's manufacturing sector reported a strong performance.
Written by Kimberley Homer.
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