JGBs fall, tracking U.S. Treasuries' weakness on Fed tapering concerns
TOKYO Aug 16 (Reuters) - Japanese government bond prices slipped on Friday, tracking weakness in U.S. Treasuries after encouraging U.S. jobs data increased expectations that the Federal Reserve will reduce its bond-buying stimulus programme as soon as next month.
* The Bank of Japan's offer to buy 950 billion yen ($9.7 billion) worth of JGBs with residual maturities of one to 10 years provided some support to the market. It was the central bank's third foray into the market this week, as part of its stimulus measures to revive growth in the world's third-largest economy.
* The 10-year yield was up 1 basis point at 0.750 percent, crawling further above a three-month low of 0.730 percent touched on Tuesday. Ten-year JGB futures fell 0.14 point to 143.89.
* "If you compare the yield move for U.S. Treasuries, German Bunds and JGBs since this June, it seems that the JGB market is stable compared to Treasuries and German Bunds," said Tomohisa Fujiki, interest rate strategist at BNP Paribas in Tokyo.
"The reason behind that would be the aggressive purchasing by the BOJ. That would be also the supportive factor in today's market."
* Yields on benchmark U.S. Treasuries jumped to two-year highs overnight after the number of Americans filing new claims for jobless benefits fell to a near six-year low last week and consumer prices rose broadly in July. The data backed the view that the Fed will soon roll back its $85 billion a month stimulus programme.
* A Reuters poll on Wednesday showed a majority of economists expect the U.S. Federal Reserve to cut bond buying at its Sept. 17-18 policy meeting, with a consensus expecting the central bank would initially reduce purchases by $15 billion.
* Data also showed foreign investors sold long-term U.S. securities for a fifth straight month in June. China, the largest foreign creditor, reduced its Treasury holdings to $1.2758 trillion, while Japan further trimmed its holdings to $1.0834 trillion. China and Japan, which pared Treasury holdings for a third straight month, together accounted for about $40 billion of net Treasury outflows.
* The five-year JGB yield added 0.5 basis point to 0.275 percent after rising as high as 0.280 percent.
* Yields on longer maturities were also higher, with the 20-yield debt up 1.5 basis points at 1.690 percent and the 30-year sector up 2 basis points at 1.820 percent.
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