TOKYO, Aug 21 (IFR) - Japanese government bond prices
slipped on Thursday, tracking U.S. Treasuries which fell after
minutes of the latest Federal Reserve meeting suggested a rate
increase could come sooner rather than later.
One Japanese megabank sold the current 5-year and 10-year
JGBs in relatively large lots, ahead of this session's monthly
400 billion yen ($3.85 billion) add-on sales of off-the-run
10-year and 20-year JGBs.
The Bank of Japan refrained from making any purchases under
its massive asset-buying programme, as it typically does on days
when the Ministry of Finance conducts a sale.
A stronger U.S. dollar and rising Tokyo stocks also had some
negative impact on JGBs. The dollar briefly rose to as high as
103.96 yen, its highest level since April, while the
Nikkei stock average was up 0.7 percent.
In minutes of its July 29-30 policy meeting released on
Wednesday, the Fed cited the quick recovery in the U.S. labour
market but said it doesn't want to bring forward a planned rate
hike until the recovery looks more convincing.
That helped lift the yield on the benchmark 10-year U.S.
Treasury note to a one-week high of 2.446 percent on
JGBs rose in tandem, with the yield on the current 2-year
JGBs adding 0.5 basis point from Wednesday to
0.075 percent, while the 5-year JGB yield rose 1
basis point to 0.165 percent, its highest level since July 7.
Both the 10-year yield and the 30-year yield
rose 2 basis points to 0.530 percent and 1.675
percent, respectively, while the 20-year yield
was up 2.5 basis points at 1.375 percent, compared with
Tuesday's average auction yield of 1.342 percent.
The 10-year lead September JGB futures contract
lost 0.14 point to 145.88.
($1 = 103.8600 Japanese yen)
(Reporting by Masatsugu Hisatsune; Editing by Jacqueline Wong)