May 19, 2017 / 5:02 AM / 3 months ago

Longer-dated JGBs gain on central bank debt-buying, yield curve flattens

TOKYO, May 19 (Reuters) - Longer-dated Japanese government bond prices gained on Friday, supported by a regular Bank of Japan debt-buying operation that helped flatten the yield curve.

The benchmark 10-year JGB yield was flat at 0.040 percent after rising to as high as 0.045 percent earlier in response to a rise in U.S. Treasury yields.

The 30-year bond yield, on the other hand, fell half a basis point to 0.800 percent after the BOJ offered to buy 300 billion yen ($2.69 billion) of longer-dated JGBs in its regular bond-buying operation.

The yield curve flattened as a result, with the yield spread between 10-year and 30-year JGBs at its tightest since April 25.

Treasury yields rose from one-month lows on Thursday as Wall Street stocks recovered from Wednesday's dramatic drop, reducing demand for safe-haven bonds. ($1 = 111.3700 yen) (Reporting by the Tokyo markets team; Editing by Eric Meijer)

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