Another Day, Another Japanese Bond Market Halt

For the fourth day in a row, Japanese bond futures markets were halted due to significant (and rapid) price movements. Three of the four halts have been on downside shifts (with the upside surge driven by the BoJ's first attempt at monetization). The daily ranges in longer-dated JGBs are incredible and certainly the last word one would use to describe the quadrillion Yen Japanese bond market since the BoJ's announcement is 'orderly'. As Kyle Bass noted, the volatility in JGBs will be the gauge of the market's qualitative perception that Abenomics can succeed; for now it appears, with longer-dated JGB yields at pre-BoJ levels, having exploded 30-40bps off the lows, and short-dated JGB yields soaring to 11-month highs, things look a little out of control.

 

Halts...

 

Dis-orderly...

 

Losing control...

 

Charts: Bloomberg