Super-long JGB yields rise in line with US Treasuries

TOKYO: Yields on super-long Japanese government bonds edged higher on Thursday, tracking overnight moves in US Treasuries, after the Federal Reserve repeated its pledge to keep interest rates near zero to help the economy recover from the coronavirus pandemic.

Benchmark 10-year JGB futures fell half a point to 152.31, with a trading volume of 12,698 lots.

The 10-year JGB yield was flat at 0.015pc.

The 30-year JGB yield added half a basis point to 0.540pc and the 40-year JGB yield gained a basis point to 0.565pc.

The 20-year JGB yield was unchanged at 0.390pc.

The auction for 3 trillion yen of two-year debt on Thursday saw solid demand as the tail, the difference between the average and lowest accepted auction price, narrowed to 0.007 from 0.009 in the previous auction.

The bid-to-cover ratio, a gauge of demand, came in at 4.56.

The two-year JGB yield and the five-year yield edged down half a basis point each to minus 0.140pc and minus 0.120pc, respectively.

Market sentiment was cautious amid surging coronavirus cases in Japan, as investors worried over the possibility additional government bonds would be issued.

The Nikkei newspaper reported Tokyo plans to urge shorter operating hours for restaurants and karaoke parlours next month, a day after daily new cases crossed the 1,000 mark for the first time in Japan.