December 17, 2019 / 4:34 AM / a month ago

JGB futures trim losses, 20-year yield falls after auction

TOKYO, Dec 17 (Reuters) - Japanese government bond futures trimmed losses on Tuesday after an auction of 20-year debt was greeted with reasonably strong demand ahead of a Bank of Japan (BOJ) policy meeting that ends on Thursday.

While the central bank is unlikely to announce any major policy changes, many investors stayed on the sidelines, awaiting its assessment of a recent rise in yields on 10-year bonds.

Benchmark 10-year JGB futures fell 0.10 point to 152.22, with a trading volume of 14,674 lots.

The 10-year JGB yield rose 1.5 basis points to minus 0.015%.

The 20-year JGB yield fell 0.5 basis point to 0.275% as the auction surprised some traders who were expecting demand to weaken dramatically.

The 30-year JGB yield fell 1 basis point to 0.395%, but the 40-year JGB yield rose 1 basis point to 0.435%.

In the middle of the yield curve, the five-year yield rose 1.5 basis points to minus 0.115%.

At the short end, thee two-year JGB yield rose 0.5 basis point to minus 0.130%.

The government will auction 1-year treasury bills on Wednesday, which will be a chance to measure investor demand for shorter-dated paper. (Reporting by the Tokyo markets team; Editing by Arun Koyyur)

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