JGB yields slip tracking U.S. peers as Fed hints at rate hike pause

March 24, 2023 06:55 PM AEDT | By Reuters
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TOKYO, March 24 (Reuters) - Japanese government bond (JGB) yields mostly fell on Friday, tracking U.S. Treasury yields, which dropped on expectations that the Federal Reserve may pause interest rate hikes.

The 10-year JGB yield fell 1.5 basis points (bps) to 0.280%, while the 20-year JGB yield slipped 0.5 bp to 1.050%.

U.S. Treasury yields dropped overnight, a day after the Fed hiked rates by 25 bps but indicated that it is on the verge of pausing further tightening after the recent collapse of two U.S. banks.

"Japanese government bond prices are firm as U.S. Treasury yields, particularly those on shorter-end notes, fell on expectations that the Fed may pause rate hikes," said Shinsuke Kajita, chief strategist at Resona Holdings Inc in Tokyo.

The five-year yield fell 1.5 bps to 0.060% and the two-year JGB yield was flat at -0.065%.

Yields on longer-end notes rose, with the 30-year JGB yield rising 1 bp to 1.320% and the 40-year yield climbing 2.5 bps to 1.575%.

Benchmark 10-year JGB futures rose 0.18 yen to 148.7, with a trading volume of 8,663 lots.

(Reporting by Tokyo markets team; Editing by Sonia Cheema)


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