JGB yields rise as US Treasury yields higher, yen weakens
TOKYO, Oct 22 (Reuters) -Japanese government bond yields rose on Tuesday, as investors sold bonds after U.S. Treasury yields rose and the yen hit a near three-month low.
The 10-year JGB yield JP10YTN=JBTC rose to as high as 0.985%, its highest since Aug. 2, and was last up 2 basis points (bps) at 0.975%.
The five-year yield JP5YTN=JBTC rose 2 bps to 0.595%. The two-year JGB yield JP2YTN=JBTC rose 1.5 bps to 0.445%.
"Investors sold JGBs as U.S. Treasury yields rose and the yen weakened," said Keisuke Tsuruta, senior fixed income strategist at Mitsubishi UFJ Morgan Stanley Securities.
The yield on the benchmark U.S. 10-year Treasury note US10YT=RR rose to as high as 4.22% in Asia trade, its highest since July 26.
The rising yields weighed on the yen JPY=EBS, which is extremely sensitive to moves in Treasuries. The yen on Tuesday touched a near three-month low of 151.1 per dollar.
The weaker yen raises import costs, which lifts prices in Japan, driving expectations for the Bank of Japan's interest rate increases.
The U.S. dollar clung to a two-and-a-half-month high on Tuesday on expectations the Federal Reserve will take a measured approach to interest rate cuts, while a close battle in the upcoming U.S. election kept investors on edge. FRX/
Yields on Japan's longer-dated bonds also rose, with the 20-year JGB yield JP20YTN=JBTC rising 2.5 bps to 1.775%. The 30-year JGB yield JP30YTN=JBTC rose 3.5 bps to 2.2%.
The 40-year JGB yield JP40YTN=JBTC rose 2 bps to 2.48%.
Reporting by Junko Fujita; Editing by Mrigank Dhaniwala
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