November 22, 2019 / 4:01 AM / 23 days ago

JGB prices fall as U.S.-China trade deal hopes sap safe-haven demand

TOKYO, Nov 22 (Reuters) - Japanese government bond prices fell on Friday, sending yields higher across the curve, as hopes for an interim agreement to de-escalate a bruising trade war between the United States and China hurt demand for safe havens.

China will work to reach a preliminary deal with the United States as both sides keep communication channels open, the Chinese commerce ministry said on Thursday, in an attempt to allay fears talks might be unravelling.

Both countries have imposed tariffs on each other’s goods in a dispute over Chinese trade practices that Washington says are unfair. Rolling back even some of these tariffs would be positive for global growth, which would weigh on bond prices.

Benchmark 10-year JGB futures fell 0.32 point to 153.1, with a trading volume of 12,891 lots.

The 10-year JGB yield rose 3 basis points to minus 0.085%. The 20-year JGB yield increased 2.5 bps to 0.265%.

The 30-year JGB yield rose 2 bps to 0.410%.

In the middle of the yield curve, the five-year yield increased 2.5 bps to minus 0.185%.

At the short end of the curve, the two-year JGB yield rose 1.5 bps to minus 0.185%. (Reporting by the Tokyo markets team; Editing by Subhranshu Sahu)

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