TOKYO, Oct 22 Reuters - U.S. Treasury yields rose on Friday, tracking Japanese government bonds higher, while investors became cautious after sell-offs as they wanted to confirm the pace of U.S. rate hikes.
The 20 year JGB yield rose 0.5 basis point to 0.090% and the 10 year JGB yield rose one basis point to 0.485%.
U.S. Treasury yields rose overnight as a tighter labour market pointed to a recovering economy that renewed questions about the pace of inflation and when the Federal Reserve will raise interest rates.
The 10-year JGB yields could touch 0.1% in the near future depending on the U.S. Treasury yields, a market participant said.
The economy is on course for recovery as the Bank of Japan is discussing phasing out a COVID - 19 loan programme if infections in the country continue to dwindle, potentially setting the bank up to exit a key crisis-mode policy sooner than investors expect.
The 30 year JGB yield also rose one basis point to 0.700%, while the 40 year JGB yield remained at 0.755% after being untraded.
The two-year JGB yield was flat at minus 0.115% and the five-year yield rose 0.5 basis point to minus 0.070%.
Benchmark 10 year JGB futures fell 0.10 point to 151.27, with a trading volume of 15,640 lots.