JGB yields drop as soft U.S. data fans slowdown worries

• Japanese government bond (JGB) yields fell across maturities on Friday after a soft U.S. service sector survey fanned growth worries and lowered U.S. Treasury yields.
• The 10-year cash JGB yield fell 2 basis points to minus 0.215pc.

TOKYO: Japanese government bond (JGB) yields fell across maturities on Friday after a soft U.S. service sector survey fanned growth worries and lowered U.S. Treasury yields.

Benchmark 10-year JGB futures rose 0.14 point to 155.15, with a trading volume of 19,833 lots.

The 10-year cash JGB yield fell 2 basis points to minus 0.215pc.

In the super-long zone, the 20-year yield fell one basis point to 0.180pc, while the 30-year and the 40-year yields fell half a basis point each to 0.350pc and 0.405pc, respectively.

At the shorter end of the curve, the two-year yield fell one basis point to minus 0.335pc and the five-year yield fell 1.5 basis points to minus 0.370pc.

On Thursday, the survey from the U.S. Institute for Supply Management (ISM) showed its non-manufacturing activity index falling to the lowest level in more than three years in September, and far below expectations.

The downbeat U.S. economic news adds to a set of weak data earlier in the week, and has deepened fears that the U.S.-China trade war is starting to hurt growth in the world's biggest economy, resulting in Treasury yields dropping across maturities.

Still, many investors remained on the sidelines ahead of a key U.S. jobs report that could help determine whether the Federal Reserve cuts interest rates further.

The data due later on Friday is forecast to show that nonfarm payrolls increased by 145,000 jobs in September from 130,000 jobs in August.