January 18, 2019 / 4:10 AM / a month ago

JGBs ease tracking U.S. Treasuries; liquidity-enhancing auction draws robust demand

TOKYO, Jan 18 (Reuters) - Japanese government bond (JGB) prices edged lower on Friday tracking a fall in U.S. Treasuries and as gains in equities dimmed the safe-haven allure of debt.

The benchmark 10-year JGB yield rose 1.0 basis point to 0.015 percent. Ten-year JGB futures were down 0.12 points at 152.46 by early afternoon trade, with a trading volume of 17,614 lots.

The super-long zone followed suit, with the 20-year yield tacking on 1.0 basis point to 0.470 percent and the 30-year yield up half a basis point at 0.700 percent.

The finance ministry on Friday offered to sell 600 billion yen ($5.49 billion) of off-the-run JGBs with remaining maturities of 5 years to 15.5 years. The ministry regularly conducts such sales in an attempt to provide the market with liquidity.

The auction bid-to-cover ratio, which gives an indication of demand, came in at 3.50, above a bid-to-cover ratio of 3.12 from the previous auction.

U.S. Treasury yields rose on Thursday with the benchmark 10-year yield reaching near three-week highs as better-than-expected economic data and hopes for progress in U.S.-China trade talks reduced the appeal of government debt. ($1 = 109.3400 yen) (Reporting by Tokyo Markets team; Editing by Shreejay Sinha)

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