JGBs slip, taking cue from strong stocks ahead of US jobs data

Thu Feb 6, 2014 9:53pm EST

Related Topics

TOKYO, Feb 7 (IFR) - Japanese government bond prices slipped on Friday, taking their cue from stronger Tokyo equities as investors positioned for an upbeat U.S. jobs report later in the session.

JGB prices ended the morning session lower, sending yields up 2 to 3.5 basis points on the day in the 10-year and longer zones, as the Nikkei stock average rose 1.6 percent by midday.

The latest nonfarm payrolls report for January will provide clues on the health of the U.S. labour market and the broader economy. The data, due later on Friday, is expected to show that employers added 185,000 jobs in January, according to the median estimate of economists polled by Reuters.

U.S. Treasury prices fell for the third consecutive session on Thursday, which also pressured JGB prices.

In midmorning trading, the yield on the new 30-year JGBs (reopening issue No. 41) broke above the highest accepted yield of 1.60 percent in Thursday's auction, briefly rising as high as 1.615 percent. It was last at 1.610 percent, up 2.5 basis points.

JGB traders said most domestic institutional investors stayed on the sidelines in the morning, awaiting the results of this session's JGB purchases by the Bank of Japan, which offered to buy 200 billion yen ($1.96 billion) worth of JGBs in the 10-year and longer zones.

At midday, the yield on five-year JGBs was up 0.5 basis point at 0.20 percent, while the 10-year JGB yield was up 2 basis points at 0.625 percent.

The yield on 20-year JGBs was up 3 basis points at 1.450 percent.

Lead March JGB futures moved in a 144.60-144.72 range before finishing midday down 0.17 point at 144.63.

FILED UNDER:
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

Find your dream retirement town

Florida? Hawaii? Reuters has teamed up with Zillow to give you the power to customize a list of your best places to retire.  Video | Full Article