TOKYO, June 4 (Reuters) - Japanese government bonds
(JGBs) fell on Thursday, sending yields higher across the curve,
as investors weighed firmer Bank of Japan rate-hike expectations
and global inflation concerns.
Here are a few details:
* The yield on the benchmark 10-year JGB
climbed 2.5 basis points (bps) to 2.665%. The two-year yield
, the one most sensitive to Bank of Japan policy
rates, gained 1.5 bps to 1.415%. Yields move inversely to bond
prices.
* BOJ Governor Kazuo Ueda said on Wednesday the central bank
must discuss the pros and cons of raising interest rates if
upside inflation risks outweigh downside risks to the economy.
His comments reinforced expectations that the BOJ will raise its
key rate from 0.75% to 1% at its June meeting.
* "The speech delivered yesterday by Bank of Japan Governor
Ueda contained many important hawkish messages," Ataru Okumura,
a senior rate strategist at SMBC Nikko Securities, said in a
note. "It is possible that he will raise interest rates at the
June meeting while emphasising more strongly than before the
BOJ's intention to continue raising rates beyond that point."
* Inflation concerns hung over global debt markets, with
U.S. Treasury yields climbing overnight amid renewed U.S.-Iran
hostilities that pushed oil prices higher and revived inflation
concerns.
* "Negative factors surrounding ultra-long-term bonds, such
as inflation concerns and worries about fiscal expansion, have
not been resolved," Keisuke Tsuruta, a senior bond strategist at
Mitsubishi UFJ Morgan Stanley Securities, said in a note.
* The 20-year yield advanced 4 bps to 3.575%,
while the 30-year yield added 2.5 bps to 3.880%.
The yield on the 40-year JGB, Japan's longest
tenor, increased 0.5 bp to 3.755%.