April 30, 2020 / 6:35 AM / a month ago

JGBs edge lower as investors remain cautious over pandemic's impact

TOKYO, April 30 (Reuters) - Japanese government bond prices edged lower on Thursday, as investors remained cautious of the pandemic’s economic impact.

Benchmark 10-year JGB futures fell 0.02 point to 152.82, with a trading volume of 7,716 lots.

As many of the economies in developed countries prepare to reopen, Japan’s Prime Minister Shinzo Abe said that he would consult with experts whether to extend a nationwide state of emergency. The government plans to extend it by about one month, the Nikkei business daily reported.

Analysts say while the possible impact of a longer state of emergency will be limited, the damage on the economy could potentially increase in the long run.

“If another fiscal expansion occurs to alleviate the negative effect on the economy, there will be concerns over an increase in the issuance of government bonds,” said Keiko Onogi, senior strategist at Daiwa.

In the cash bond market, the 10-year JGB yield rose 0.5 basis point to minus 0.045%.

At the shorter end of the market, the two-year JGB yield fell 0.5 basis point to minus 0.185%, while the five-year yield rose 1 basis point to minus 0.160%.

The 20-year JGB yield rose 1 basis point to 0.300%, and the 30-year JGB yield rose 0.5 basis point to 0.420%. (Reporting by Eimi Yamamitsu; Editing by Rashmi Aich)

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