Lead December JGB futures briefly hit 144.73, their highest level since June 2003, as the market is still digesting LDP chief Abe's comments Thursday that the BOJ should cut interest rates to zero or to negative territory. But "since Mr. Abe is in favor of reflationary policy, JGB yields in the 10-year and longer zones will unlikely decline much" despite his aggressive monetary policy stance, says Nobuto Yamazaki, an executive fund manager at DIAM Asset Management. Unless longer-dated bonds regain uptrend, further upside in JGB futures will likely be limited, he adds. The 20-year cash JGB yield is currently up 1.5 bps at 1.685%. Meanwhile, lead euroyen futures rise to 99.755, their highest level since July 31.
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