JGB prices edge lower ahead of Wednesday's five-year auction
TOKYO, July 16 (Reuters) - Japanese government bond prices edged lower on Tuesday ahead of an auction of 2.7 trillion yen ($27 billion) worth of five-year bonds in the following session.
* The 10-year yield was up 0.5 basis point to 0.820 percent after falling 4 basis points last week, while 10-year JGB futures dipped 0.03 point to 143.13, with 7,067 contracts changing hands in the morning session, compared with this year's full daily average of 33,082 contracts.
* According to International Financing Review, a Thomson Reuters publication, a few regional banks sold eight-year JGBs in relatively large lots ahead of Wednesday's auction of the five-year bonds, while some players sold 30-year JGBs.
* The 30-year yield added 2 basis points to 1.865 percent, while the 20-year yield was up 1 basis point to 1.725 percent.
* The five-year yield was untraded after falling 2.5 basis points last week to 0.295 percent. It touched a four-week low of 0.290 percent on Thursday.
* "The five-year yield at 30 basis points is not that super-attractive. We should see some concession into the five-year auction tomorrow but after that the yield should stay around this level," said Tomohisa Fujiki, interest rate strategist at BNP Paribas.
* Volatility has eased in the JGBs recently after the market was jolted by the Bank of Japan's announcement of a massive bond-buying programme on April 4 to pull the world's third-largest economy out of deflation.
* The 30-day implied volatilites on JGB futures fell to a more than two-month low of 2.70 on Friday. It hit a two-year high of 6.1 on April 12.