October 6, 2017 / 6:17 AM / in a year

JGBs edge lower, taking cue from Treasuries

TOKYO, Oct 6 (Reuters) - Japanese government bonds edged down on Friday, taking their cue from U.S. Treasuries as investors awaited U.S. employment data later in the global day.

The 10-year cash JGB yield inched up one basis point to 0.050 percent, while the 10-year JGB futures contract finished down 0.13 point at 150.40.

The curve steepened as the super-long zone slightly weakened, with the 20-year JGB yield adding 1.5 basis points to 0.585 percent. The 30-year JGB yield rose 2 basis points to 0.880 percent.

In its regular JGB purchase operations on Friday, the Bank of Japan offered to buy 410 billion yen ($3.63 billion) of five- 10-year JGBs, 200 billion yen of 10- to 25-year JGBs, and 100 billion yen of JGBs maturing in more than 25 years. All amounts were in line with its previous buying operations for those zones.

Later on Friday, Wall Street economists expect September employment figures to show 90,000 new U.S. jobs, down from 156,000 in August, according to a Reuters poll, with the headline number likely affected by the hurricanes that hit the United States last month.

The yields on U.S. Treasury notes rose on Thursday, lifted by the S&P 500 index’s sixth straight record high close as well as comments from Federal Reserve officials that supported another interest rate hike this year.

Philadelphia Federal Reserve Bank President Patrick Harker, a voter on the Federal Open Monetary Policy Committee, said he still expects a rate increase in December. San Francisco Fed President John Williams echoed the same sentiment.

Following the Fed officials’ comments, the rate futures market priced in a more than 80 percent chance of a rate increase in December, according to CME’s FedWatch.

$1 = 112.9800 yen Reporting by Tokyo markets team; Editing by Amrutha Gayathri

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