TOKYO, June 9 (Reuters) - Japanese government bonds gained on Friday, with yields taking cue from U.S. Treasuries and pulling away from the previous session’s multi-month highs.
The 10-year cash JGB yield shed 1.5 basis points to 0.050 percent, after rising as high as 0.075 in the previous session, its highest since mid-March.
The front-month 10-year JGB futures contract added 0.13 points to finish at 150.60.
Investors’ main focus remained squarely on overseas events, as British Prime Minister Theresa May’s Conservative Party lost its parliamentary majority in a general election and cast the country’s politics into turmoil, potentially disrupting Brexit negotiations.
Prices of U.S. 10-year Treasury futures rose in after-hour trading after exit polls suggested May’s ruling party would fail to secure a parliamentary majority.
The yield on the benchmark U.S. Treasury note was at 2.188 percent in Asian trading, down from its U.S. close of 2.194 percent on Thursday.
In the superlong zone, the 20-year JGB yield shed 2 basis points to 0.560 percent, while the 30-year JGB yield fell 1.5 basis points to 0.825 percent. They had hit highs of 0.585 percent and 0.845 percent respectively on Thursday, their highest since mid-May.
Yields were pushed higher on Thursday after a media report said the Bank of Japan was considering how to communicate its eventual exit from monetary stimulus to markets.
However, later on Thursday, BOJ Governor Haruhiko Kuroda said the central bank still has far to go to reach its 2 percent inflation target, though its ultra-loose monetary policy has helped stabilise public inflation expectations.
In its regular purchasing operations on Friday, the BOJ offered to buy 280 billion yen of one- to three-year JGBs, 300 billion yen of three- to five-year JGBs, 200 billion yen of 10- to 25-year JGBs, and 100 billion yen of JGBs maturing in more than 25 years. (Reporting by Tokyo markets team; Editing by Sherry Jacob-Phillips)