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JGB futures slide as Treasuries fall, Nikkei jumps
* Treasuries fall, Nikkei jump spark JGB selling
* Longer-dated bonds dented before Tuesday's 20-year auction
* Shirakawa to speak but seen unlikely to surprise market
By Rika Otsuka
TOKYO, Aug 25 (Reuters) - Japanese government bond futures slid further from a four-month high on Monday as a fall in U.S. Treasuries late last week and a stock market rally prompted investors to trim holdings of government debt.
Adding to pressure on JGBs, some players sold longer-dated bonds to make room in their portfolios before the Ministry of Finance's 20-year debt auction on Tuesday.
Traders said light profit-taking also dented JGBs after the benchmark 10-year yield hit a four-month low just above 1.4 percent last week.
JGBs have been firm for the past month, supported by expectations that a global slowdown would hurt the Japanese economy, prompting the Bank of Japan to stand pat for some time.
The market awaited comments from BOJ Governor Masaaki Shirakawa as he is scheduled to speak later in the day.
But analysts expect his comments to be largely in line with remarks the BOJ made after its Aug. 18-19 policy meeting, at which the central bank left interest rates unchanged at 0.5 percent.
The BOJ said last week that economic growth had been sluggish due to weaker growth in exports as well as high energy and raw material prices. But it stuck to the view that the economy would eventually return to moderate growth.
"Shirakawa's comments are not expected to surprise the market," said Tetsuya Miura, a bond strategist at Shinko Securities. "Given the BOJ's view on the economy last week, he is highly unlikely to say anything that hurts JGBs."
September futures fell 0.17 point to 137.52 2JGBv1, falling further from a four-month high of 138.12 hit earlier this month.
The benchmark 10-year yield rose 2 basis points to 1.460 percent JP10YTN=JBTC, off a four-month low of 1.410 percent struck last week.
The 20-year yield edged up 1 basis point to 2.120 percent JP20YTN=JBTC and the two-year yield was up 1.5 basis points to 0.700 percent JP2YTN=JBTC.
The Nikkei average .N225 jumped 2 percent in early trade. [.T]
U.S. Treasuries fell on Friday as a surging stock market unwound the bid for safe-haven government bonds and traders cut prices ahead of supply. [US/] (Editing by Michael Watson)
