TOKYO, Oct 30 (Reuters) - Japanese government bond (JGB)
yields fell on Wednesday, tracking U.S. Treasury yields lower,
as the market awaited the outcome of the Bank of Japan's policy
meeting.
The 10-year JGB yield fell 1 basis point (bp)
to 0.96%. Benchmark 10-year JGB futures rose 0.14 yen
to 143.99.
Benchmark 10-year U.S. Treasury yields hit a nearly
four-month high on Tuesday on investor wariness to buy the debt
before next week's U.S. presidential election, but dipped later
in the day after a strong seven-year note auction.
"The JGB yields on mid-to-long term bonds fell as JGB
futures rose after U.S. Treasury yields declined overnight,"
said Miki Den, senior Japan rate strategist at SMBC Nikko
Securities.
The five-year yield fell 1.5 bps to 0.58% and
the two-year JGB yield fell 0.5 bp to 0.445%.
The BOJ will conclude a two-day policy meeting on Thursday,
and the market widely expects that it will keep its policy
unchanged.
The 20-year JGB yield rose 1 bp to 1.815% and
the 30-year JGB yield rose 1.5 bps to 2.22%.
"Yields on super-long dated bonds are on an upward trend as
the market is concerned about the fiscal expansion. Whichever
parties will form a new coalition, the government spending is
seen expanding," said Den.
Japan's ruling coalition's failure to retain a majority in
Sunday's lower house elections will likely force the Liberal
Democratic Party to court smaller opposition parties such as the
Democratic Party for the People (DPP) to stay in power.
The 40-year JGBs were not traded.