July 30, 2013 / 2:21 AM / 4 years ago

Ten-year JGB yield rises ahead of this week's auction

TOKYO, July 30 (Reuters) - Yields on benchmark 10-year Japanese government bonds edged higher on Tuesday ahead of an auction of 2.4 trillion yen ($24.5 billion) worth of the same maturities later in the week.

* The 10-year yield was up 0.5 basis point at 0.795 percent after trading as high as 0.800 percent, while 10-year futures were steady at 143.62, holding slightly below their five-day moving average of 143.64.

* “The major reason for today’s weakness should be concession ahead of the 10-year auction,” said Yuya Yamashita, rates strategist at JPMorgan in Tokyo.

* The Ministry of Finance is to sell 2.4 trillion yen of 10-year debt on Aug. 1 following an auction of 2.9 trillion yen of two-year bonds with a coupon rate of 0.1 percent on Tuesday. The two-year yield was unchanged at 0.125 percent.

* The five-year yield added 0.5 basis point to 0.295 percent, while the 30-year yield was down 0.5 basis point at 1.820 percent.

* But Yamashita said he expected many market participants would remain on the sidelines this week, with the Federal Reserve’s policy meeting on Tuesday and Wednesday, the U.S. second quarter GDP on Wednesday and U.S. nonfarm payrolls report on Friday.

* Japan’s industrial output fell last month at the fastest pace since March 2011’s massive earthquake and tsunami as companies curbed production to avoid a build-up in inventories, but analysts see factory activity remaining on the recovery path due to strong exports and private consumption.

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