TOKYO, May 28 (Reuters) - Japanese government bond (JGB) prices edged higher on Tuesday, with the market sentiment lifted after a 40-year bond auction attracted ample investor demand.
The advance by the JGB market was slowed as Tokyo stocks gained and dented the allure of safe-haven debt.
The 20-year JGB yield JP20YTN=JBTC fell 1 basis point to 0.320%, its lowest since August 2016.
The 30-year yield JP30YTN=JBTC declined 1.5 basis points to 0.490%.
The bid-to-cover ratio, a gauge of demand, at Tuesday's 400 billion yen ($3.65 billion) 40-year JGB sale rose to 3.87 from 3.50 at the previous auction in March.
The new 40-years were seen to have drawn bids from life insurers and pension funds, the core buyers of super-long JGBs.
($1 = 109.4700 yen)
(Reporting by the Tokyo markets team, Editing by Sherry Jacob-Phillips)
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