September 4, 2017 / 7:12 AM / a year ago

JGB yields hit 10-mth low on N.Korea woes, looming auction limits fall

TOKYO, Sept 4 (Reuters) - The benchmark 10-year Japanese government bond yield touched its lowest level since mid-November on Monday amid tensions stemming from the Korean Peninsula, although caution before a coming 10-year auction limited the yield’s decline.

The 10-year JGB yield stood unchanged at minus 0.005 percent after touching the 10-month low of minus 0.010 percent earlier in the day, when the financial markets reacted to news that North Korea conducted its sixth and most powerful nuclear test on Sunday.

The benchmark JGB yield turned negative for the first time since mid-November last week on the back of steadily escalating regional tensions.

The fall in the benchmark yield stopped for the time being as the market braced for Tuesday’s 10-year auction, at which the Japanese finance ministry will offer 2.3 trillion yen ($20.95 billion) of that maturity.

Without an auction to contend with, the super long JGB maturities on Monday fared better than the 10-years. The 30-year yield fell 1 basis point to 0.810 percent, its lowest since June 28.

($1 = 109.7800 yen)

Reporting by the Tokyo markets team; Editing by Richard Borsuk

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