Traders agonise over 'the curve' as Japan upends world bonds
New York
SPECULATION about a shift in Japanese monetary policy is changing the shape of bond markets around the world.
The gap between short and long-term yields is widening globally on bets the Bank of Japan's (BOJ) next monetary twist at its Sept 20-21 policy meeting will steepen the yield curve. Japan would achieve that by cutting its negative interest rate further, while simultaneously reducing purchases of long-term bonds, according to Morgan Stanley MUFG Securities Co in Tokyo, one of the nation's 21 primary dealers.
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