February 22, 2018 / 6:21 AM / 10 months ago

Long-end JGBs gain after solid 20-year bond auction

TOKYO, Feb 22 (Reuters) - Prices of long-term Japanese government bonds edged higher, pushing the 40-year JGB yield down to the lowest in more than a year on Thursday, after an auction of 20-year bonds attracted solid demand.

The 40-year JGB yield slipped to as low as 0.900 percent , its lowest level since January 2017.

The 30-year JGB yield touched a low of 0.770 percent , its lowest level since April 2017.

The price of 10-year JGB futures rose 0.05 point to 150.83 , having pulled up from an intraday low of 150.76.

The 10-year JGB yield was little changed at 0.055 percent

Earlier on Thursday, the 10-year JGB futures had come under pressure after U.S. Treasury yields surged on Wednesday as the minutes of the latest Federal Reserve meeting affirmed expectations of further rate increases this year.

Hedging activity ahead of an auction of 20-year bonds also weighed on JGB futures earlier in the session.

The auction of 20-year bonds, however, attracted solid demand, with a bid-to-cover ratio of 4.44 times, up from 4.17 times at the previous 20-year JGB auction. (Reporting by Tokyo markets team; Editing by Sunil Nair)

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