JGB prices gain as U.S. Treasuries rise, Japan shares slide
TOKYO, Dec 4 (IFR) - Japanese government bond prices edged higher on Wednesday, tracking gains in U.S. Treasuries the day before and as Tokyo shares slid.
The 10-year yield was down 1 basis point at 0.620 percent, while 10-year JGB futures rose 13 ticks to 144.97.
A few pension funds and life insurers bought superlong JGBs, helping longer-dated debt to slightly outperform, leading to a flattening of the yield curve.
A few players also sold the 10-year sector and bought longer-maturities ahead of Thursday's 2.4 trillion yen ($23.4 billion) sale of 10-year debt.
The 20-year yield eased 1.5 basis points to 1.480 percent, while the 30-year yield slipped 2 basis points to 1.645 percent.
Also supporting the market, the Bank of Japan offered to buy 700 billion yen ($6.8 billion) worth of JGBs in the secondary market with residual maturities of between one and more than 10 years, as part of its campaign to pull the world's third-largest economy out of persistent deflation.
Bank of Japan board member Takehiro Sato said on Wednesday that he saw no need to ease monetary policy pre-emptively if the pain inflicted on the economy from next year's sales tax hike proved to be temporary.
Overnight, the benchmark 10-year U.S. Treasury yield fell 2.6 basis points to 2.775 percent as global equities took a beating on concerns that the U.S. Federal Reserve could soon withdraw its massive stimulus.
Japan's Nikkei share average shed 2.1 percent in the morning session, pulling away from a 6-year closing high set in the previous session on renewed concerns over the Federal Reserve's exit from its asset purchase scheme.