TOKYO, March 20 (Reuters) - Japanese government bond (JGB) yields fell on Monday after investors sought to buy safe-haven debt as worries about a potential global banking sector crisis continues.
The 10-year JGB yield fell 1.5 basis points (bps) to 0.255% after slipping to 0.250%.
The two-year JGB yield fell to as low as negative 0.090%, its lowest since Sept. 5, before trading flat at negative 0.080%.
“The 10-year bond yield will not fall significantly lower than the current level. But with sentiment remaining weak, it could take time for the yield climb back to the top end of the Bank of Japan (BOJ)’s policy band,” said Shun Totani, chief fund manager, Asahi Life Asset Management.
“But market consensus is that the BOJ will eventually tweak its YCC (yield curve control) policy. Unless there is another big bank failure, the yield will start rising.”
In a crisis that began with the collapse of U.S.-based Silicon Valley Bank last Friday, investors lost confidence in U.S. regional banks and Credit Suisse in Europe.
Investors sold Japanese equities on Monday despite Swiss lender UBS Group’s rescue acquisition of Credit Suisse, sending the Nikkei down more than 1%.
Yields fell across the tenors, with the 20-year JGB yield falling 3 bps to 1.030% and the 30-year JGB yield down 1.5 bps to 1.270%.
The 40-year JGB yield fell 1.5 bps to 1.500%.
The five-year yield fell 2 bps to 0.080%. (Reporting by Junko Fujita)
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