Bond Rout in Japan Will Pass, Says Analyst Who Picked Rally
- ‘It’s simply a misunderstanding’ by market: Tokai Tokyo’s Sano
- Falling liquidity exposes market to spike in yields, Sano says
Japan bond superbull Kazuhiko Sano remains committed to his stance that’s been vindicated since 2012 despite a recent surge in yields to the highest in five months, because he thinks the rout is driven by a “misunderstanding” over what the Bank of Japan will do next week.
Japanese government bonds are headed for their worst quarter in 13 years. A gauge that tracks notes with maturities longer than 10 years completed the longest losing streak in three years on Sept. 5 on concern the BOJ will signal a tapering of monetary easing when it reveals a comprehensive policy review at its Sept. 20-21 meeting. Governor Haruhiko Kuroda emphasized in a speech last week that the review won’t result in any reduction in monetary stimulus, while “other new ideas should not be off the table.”