October 9, 2019 / 7:02 AM / 15 days ago

Mid- and short-term JGBs slightly firmer as Sino-U.S. tensions heighten

TOKYO, Oct 9 (Reuters) - Mid- and short-term Japanese government bond (JGB) prices firmed slightly on Wednesday as escalating U.S.-China tensions diminished hopes for a trade deal, boosting safe-haven assets.

Benchmark 10-year JGB futures rose 0.07 point to 155.02, with a trading volume of 11,175 lots.

The key 10-year cash JGB yield fell one basis point (bp) to minus 0.215%.

At the shorter end of the curve, the two-year yield dropped half a basis point to minus 0.330% and the five-year yield was unchanged at minus 0.360%.

In the super-long zone, the 20-year and the 30-year yields stood flat at 0.200% and 0.370%, respectively.

Washington on Tuesday imposed visa restrictions on Chinese officials for the detention or abuse of Muslim minorities, a move Beijing denounced as interference in its internal affairs. The U.S. decision cast a pall over high-level trade talks set to begin on Thursday.

Meanwhile, the Treasury yield curve steepened overnight after the U.S. Federal Reserve Chairman Jerome Powell signalled openness to further interest rate cuts and the resumption of bond purchases to address a recent volatility in money markets rates. (Reporting by the Tokyo Markets Team; Editing by Aditya Soni)

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