JGBs slip after positive U.S. data boost investor morale

Wed Apr 2, 2014 10:44pm EDT

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TOKYO, April 3 (IFR) - Japanese government bonds edged down on Thursday after upbeat U.S. data sent U.S. Treasuries lower and boosted Japanese stock prices, ahead of the auction of 400 billion yen ($3.9 billion) of 10-year inflation-linked JGBs.

The benchmark 10-year JGB futures slipped 0.13 point to 144.64. The current 10-year cash bond yield rose 1.0 basis point to 0.635 percent while the 20-year yield went up 2.0 basis points to 1.500 percent.

The move reflected rising investor appetite to riskier assets as Wall Street shares hit all-time high following solid private-sector jobs and factory orders data.

Still, the Bank of Japan's massive bond buying programme helped to limit the losses, with investor bids seen at around 0.65 percent in the 10-year bonds.

Market players expect decent demand for the inflation-linked JGBs as Japan's state pension fund is expected to start investing in inflation-linked bonds in the financial year that began on Tuesday. ($1 = 103.7200 Japanese Yen) (Reporting by Masatsugu Hisatsune; Editing by Kim Coghill)

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