JGBs edge lower as investors worry over government debt issuance

• Benchmark 10-year JGB futures gained 0.01 point to 152.34, with a trading volume of 10,235 lots, while the 10-year JGB yield stood flat at 0.000pc.
• The bid-to-cover ratio, a gauge of demand, for 500 billion yen 40-year JGB sale by the Ministry of Finance on Tuesday increased to 3.06 from 2.66 at the previous auction in March.

TOKYO: Japanese government prices fell on Tuesday as investors remained vigilant over a possible increase in the issuance of government bonds, while the 40-year bond sale drew ample investor demand.

Prime Minister Shinzo Abe said that the total amount of stimulus from two economic packages would exceed 200 trillion yen ($1.85 trillion). The government is expected to approve the budget on Wednesday.

Benchmark 10-year JGB futures gained 0.01 point to 152.34, with a trading volume of 10,235 lots, while the 10-year JGB yield stood flat at 0.000pc.

The bid-to-cover ratio, a gauge of demand, for 500 billion yen 40-year JGB sale by the Ministry of Finance on Tuesday increased to 3.06 from 2.66 at the previous auction in March.

The 40-year JGB yield rose 1 basis point to 0.500pc, its highest since April 17.

Elsewhere in the superlong zone, the 30-year JGB yield rose half a basis point to 0.480pc, while the 20-year JGB yield was unchanged at 0.340pc.

At the shorter end of the market, the two-year JGB yield gained 1 basis point to minus 0.165pc while the five-year yield stood flat at minus 0.135pc.