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JGB yields fall, curve flattens as recovery hopes lose steam

TOKYO, Aug 5 (Reuters) – Japanese government bond yields fell on Wednesday and the yield curve flattened, as hopes for a swift economic recovery from the coronavirus outbreak started to fade.

The move followed a similar decline in U.S. Treasury yields.

The five-year Treasury yield hit a record low on Tuesday and the benchmark 10-year Treasury yield fell to a five-month due to concern a resurgence of the coronavirus is snuffing out a U.S. economic recovery.

Japan is also grappling with its own second wave of the virus, which boosts the appeal of holding government debt.

Benchmark 10-year JGB futures rose 0.09 point to 152.46, with a trading volume of 13,462 lots. Earlier in the session futures prices hit a three-month high.

The 10-year JGB yield fell 0.5 basis point to 0.005%, close to the lowest in almost two months.

The 20-year JGB yield fell 1.5 basis points to 0.375%, while the 30-year JGB yield fell 1.5 basis points to 0.535%.

At the middle of the yield curve, the five-year yield declined by 0.5 basis point to minus 0.125%.

At the short end, the two-year JGB yield was unchanged at minus 0.135%. (Reporting by the Tokyo markets team; Editing by Rashmi Aich)


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