Japan’s short-end yields fall after strong auction demand

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TOKYO — Yields on short-end Japanese government bonds (JGBs) fell on Thursday after an auction for two-year bonds drew strong demand.

The two-year JGB yield fell 0.5 basis point to -0.085% and the five-year yield fell 0.5 basis point to minus 0.010%.

The auction received bids worth 4.33 times the amount available, higher than a bid-cover ratio of 3.81 at the previous auction.

The 10-year JGB yield was flat at 0.200%. Earlier, it fell to 0.195%, tracking U.S. Treasury yields after the Federal Reserve delivered an interest rate hike on expected lines.

Yields on longer-ended notes rose, with the 20-year JGB yield climbing 2 basis points to 0.840% and the 30-year JGB yield rising 3 basis points to 1.185%.

The 40-year JGB yield rose 2.5 basis points to 1.340%.

Benchmark 10-year JGB futures fell 0.03 point to 150.26, with a trading volume of 11,932 lots.

(Reporting by Tokyo markets team; Editing by Subhranshu Sahu)

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