JGB yields lower as domestic coronavirus cases spike

TOKYO, July 17 (Reuters) – Yields on Japanese government bonds fell on Friday as a growing number of coronavirus cases in the country weighed on risk sentiment, while investors booked profits ahead of the weekend.

Benchmark 10-year JGB futures added 0.07 point to 152.42, with a trading volume of 19,809 lots, reaching a near two-month high.

In the cash bond market, the 10-year JGB yield stood flat at 0.010%.

In the super-long zone, the 20-year JGB yield and the 40-year JGB yield dipped 1.5 basis points each to 0.405% and 0.620%, respectively.

The 30-year JGB yield fell 1 basis point to 0.585%.

Yields remained unchanged at the shorter end of the market, with the two-year JGB yield and the five-year yield flat at minus 0.150% and minus 0.125%, respectively.

Market participants are now looking to European Union leaders to overcome their differences over a proposed stimulus package, as they meet in Brussels later in the day.

Japan’s COVID-19 cases continued to rise, notably in Tokyo where it hit its record high of 293 fresh cases on Friday.

The Bank of Japan maintained the size of its bond purchase in its operation on Wednesday, buying 420 billion yen of 1-3 year JGBs, 350 billion yen of 3-5 year bonds and 420 billion yen of 5-10 year notes. (Reporting by Tokyo Markets Team, Editing by Sherry Jacob-Phillips)

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