Japanese government bonds are set for a sixth monthly gain, a winning streak that beats Treasurys amid investor speculation the central bank will bolster monetary easing to defeat deflation.

Japanese debt maturing in more than a year has returned 0.3 percent in May, according to an index compiled by the European Federation of Financial Analysts Societies and Bloomberg. While Treasurys have returned 1 percent so far this month, they've handed losses in March and February, the data show.

Bank of Japan Gov. Masaaki Shirakawa and his board have failed to overcome deflation and achieve their 1 percent inflation goal after two monetary easing moves this year, with government data last week showing a 0.2 percent increase in consumer prices excluding fresh food in April. Japan's benchmark 10-year yield was six basis points from a nine-year low as investors perceived the nation's notes as a haven amid concern Greece will exit the euro and roil global markets.

"JGBs are being bought because of expectations for additional monetary easing and flight to quality," said Nobuto Yamazaki, an executive fund manager in Tokyo at DIAM Co., which manages the equivalent of $124 billion. "People are cautious because of the high prices of Japan's bonds, so they occasionally take profit when the market goes up."

The yen has strengthened this month against all of its 16 major counterparts. Fitch Ratings, which cut Japan's foreign-currency credit grade last week by two levels to A+, said at the time that the nation can fund itself at low borrowing costs and that the yen exhibits "haven characteristics."

The nation's debt has returned 1.2 percent while Treasurys have handed a 1.3 percent gain this year, the EFFAS gauges show. Bunds have handed a 3.4 percent gain in Germany, where two-year notes were sold with a zero-percent coupon last week for the first time amid demand for safer assets.

Elsewhere in Japan's credit markets, Tohoku Electric Power Co. sold ¥20 billion ($252 million) in 0.737 percent five-year notes and ¥15 billion of 1.376 percent 10-year bonds, according to separate statements from underwriters Mizuho Financial Group Inc. and Mitsubishi UFJ Morgan Stanley Securities Co.

The utility last offered notes in March, becoming the first nuclear plant operator in Japan to sell debt since the Fukushima atomic disaster started in March last year.

Bank of Tokyo-Mitsubishi UFJ Ltd., the lending unit of Japan's largest banking group by market value, sold ¥60 billion in 10-year, 1.39 percent subordinated bonds on May 25, according to a filing with the Finance Ministry.

The extra yield investors demand to hold Japanese corporate debt instead of sovereign bonds has fallen three basis points this year to 47 basis points as of May 25, compared with a 37 basis point drop in the spread for company notes worldwide to 230, according to Bank of America Merrill Lynch indexes.

Changes in BOJ buyback operations highlight the market's growing demand for shorter debt. The central bank reduced the amount of one- to two-year debt that it offered to buy for its asset purchase program on Friday to ¥350 billion, down from a target of ¥600 billion set at the previous week's operation, which met a shortfall for the first time since October 2010.

The BOJ upped its purchase goal for two- to three-year debt to ¥350 billion from ¥100 billion at the previous operation, attracting ¥615.6 billion in interest to sell.

The BOJ's decision to boost buying of longer-dated notes was a "surprise," Atsushi Ito, a senior rate strategist in Tokyo at UBS AG, wrote in a report Friday. "The BOJ will have to extend the maturity of bonds that it buys" if politicians recognize the BOJ's failure to attract enough bids, he wrote.

Yields on two-year bonds were at 0.095 percent at the end of last week. That's lower than the 0.1 percent interest financial companies get from the BOJ on their deposits that exceed the reserve requirement.

Seven out of 14 economists surveyed by Bloomberg News said recently they expect the central bank to bolster monetary stimulus by July when the BOJ is scheduled to release a quarterly report on the economic outlook.

Premiums on five-year credit-default swaps that protect Japan's bonds from nonpayment were at 104.7 basis points Friday, up from this year's low of 90.1 basis points in March, according to CME Group Inc.'s CMA.

Prime Minister Yoshihiko Noda is struggling to get support for a plan to double the nation's 5 percent sales tax by 2015. Japan's debt load has grown to more than twice its annual economic output, the heaviest in the world and compares with Greece's debt, which stands at 165.4 percent of GDP.