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JGBs gain after U.S. attacks on Syria spark flight-to-quality bids
April 7, 2017 / 7:26 AM / 8 months ago

JGBs gain after U.S. attacks on Syria spark flight-to-quality bids

TOKYO, April 7 (Reuters) - Japanese government bond prices gained on Friday after the United States launched cruise missiles against an airbase in Syria, sparking buying of low-risk assets such as bonds.

The 10-year JGB yield fell 0.5 basis point to 0.050 percent , matching a low last touched in February, while the price of the 10-year JGB futures rose 0.18 point to 150.60 .

The U.S. attacks raised worries of further confrontations with Russia, which has supported the Syrian government throughout the country’s civil war.

The military action against Syria comes at a time investors have sensed a growing possibility that a large part of the economic stimulus President Donald Trump has promised may take time to be approved by Congress, and might be derailed.

The 10-year U.S. yield hit a 4 1/2-month low of 2.289 percent as investors looked to the U.S. payrolls data and the meeting between Trump and Chinese leader Xi Jinping later in the day.

A convincing fall below 2.3 percent in the 10-year U.S. yield could spark a wave of short-covering by bond bears who have bet on rising bond yields around the globe on the back of solid economic growth. (Reporting by Tokyo Markets Team; Editing by Richard Borsuk)

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