Japan’s 10-Year Yield Touches 9-Week Low as Auction Demand Rises

Japan’s government bonds rose, pushing 10-year yields to the lowest in nine weeks, after a sale of the debt drew the strongest demand since January.

Benchmark yields touched 0.39 percent, a level unseen since May 29, after the Ministry of Finance’s auction of 2.4 trillion ($19.4 billion) of 10-year notes on Tuesday had a bid-to-cover ratio of 2.84, the highest since Jan. 6.

“The auction result was fine,” said Katsutoshi Inadome, a fixed-income strategist at Mitsubishi UFJ Morgan Stanley Securities Co. “The yield broke through the 0.4 percent wall.”

The yield on the 10-year JGB was fell 1 1/2 basis points to 0.395 percent as of 1:41 p.m. Tuesday in Tokyo, according to Japan Bond Trading Co., the nation’s largest inter-dealer debt broker. A basis point is 0.01 percentage point.

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