September 20, 2017 / 7:19 AM / a year ago

Benchmark JGBs edge down as investors await Fed meeting outcome

TOKYO, Sept 20 (Reuters) - Benchmark Japanese bonds edged slightly down on Wednesday, but longer maturities steadied as investors adjusted positions ahead of the outcome of the U.S. Federal Reserve’s meeting later in the global session.

The 10-year cash JGB yield inched up half a basis point to 0.030 percent, while the 10-year JGB futures contract finished up 0.04 point at 150.81.

In the superlong zone, the 20-year JGB yield was flat at 0.555 percent, while the 30-year JGB yield fell half a basis point to 0.830 percent.

U.S. central bank policymakers are expected to say they will reduce monthly bond purchases starting next month, and also leave the door open for an interest rate hike at their Dec. 12-13 meeting.

JGBs shrugged off data released earlier on Wednesday that showed Japan’s exports rose at their fastest pace in nearly four years in August.

The JGB market has also had a muted reaction to reports that Japanese Prime Minister Shinzo Abe is considering calling an election for as early as next month. Sources have said Abe’s campaign pledges will include spending on education and child care.

Abe is also set to delay the timing for balancing a primary budget from the current fiscal 2020 to later in the decade, sources told Reuters on Wednesday, calling the government’s fiscal discipline into question.

Reporting by Tokyo markets team; Editing by Sunil Nair

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