JGB yields fall on geopolitical risk, eyes turn to Fed's Powell

Credit: REUTERS/Thomas White

Yields on Japanese government bonds fell on Thursday as worries about renewed diplomatic tension between the United States and China boosted demand for safe assets.

TOKYO, Aug 27 (Reuters) - Yields on Japanese government bonds fell on Thursday as worries about renewed diplomatic tension between the United States and China boosted demand for safe assets.

Yields also fell on expectations that U.S. Federal Reserve Chairman Jerome Powell will commit to keeping interest rates low in a speech later on Thursday.

Japan's finance ministry auctioned two-year debt to solid demand earlier on Thursday, which also supported bond prices.

Benchmark 10-year JGB futures 2JGBv1 rose 0.09 point to 151.79, with a trading volume of 15,378 lots.

The 10-year JGB yield JP10YTN=JBTC fell 0.5 basis point to 0.035%. The 20-year JGB yield JP20YTN=JBTC fell 0.5 basis point to 0.410%.

At the long end of the curve, the 30-year JGB yield JP30YTN=JBTC fell 1 basis point to 0.590%.

The five-year yield JP5YTN=JBTC fell 0.5 basis point to minus 0.090%.

At the short end, the two-year JGB yield JP2YTN=JBTC fell 0.5 basis point to minus 0.120%.

(Reporting by the Tokyo markets team; Editing by Shailesh Kuber)

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