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Japan's bond yields jump after poor outcome of 20-year debt auction
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Japan's bond yields jump after poor outcome of 20-year debt auction
May 26, 2025 10:37 AM

TOKYO, May 20 (Reuters) - Japanese government bond

yields jumped on Tuesday as investors sold the securities after

poor results at an auction of 20-year bonds spurred worries

about demand for super-long debt.

The 10-year JGB yield vaulted 4.5 basis

points (bps) to 1.525%, its highest level since March 28, after

the finance ministry announced the results of the sale in the

early Tokyo afternoon.

Benchmark 10-year JGB futures were last down 0.19

yen at 139.06 yen. Bond yields move inversely to prices.

The 40-year yield surged 10 bps to 3.55%, the

highest level since the debt's inception in 2007.

The 20- and 30-year bonds, as well as the two-year note, had

yet to trade following the release of the auction details.

Mizuho strategist Shoki Omori called the auction results

"lacklustre", "highlighting persistent supply-demand softness in

the super-long sector and fueling concerns over who, if anyone,

will step in to buy."

Brokers and investors "appear reluctant to hold inventory,

raising the likelihood of a sell-off spiral that extends beyond

the 20-year tenor into both the 10-year and 30-year markets,"

Omori said.

The five-year yield rose 1.5 bps to 1.01%, the

highest since April 2, when U.S. President Donald Trump

announced his "Liberation Day" tariffs.

(Reporting by Kevin Buckland; Editing by Varun H K)

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