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JGB futures gain after strong five-year debt auction

TOKYO, Oct 8 (Reuters) - Japanese government bond (JGB) futures trimmed gains on Thursday after an auction of five-year bonds attracted strong investor demand.

Benchmark 10-year JGB futures rose 0.04 point to 151.89, with a trading volume of 21,596 lots, while the 10-year JGB yield was unchanged at 0.035%.

At the shorter end of the market, the two-year JGB yield stood flat at minus 0.130%.

The Ministry of Finance offered 2.5 trillion yen of five-year JGBs, with the bid-to-cover ratio, a gauge of demand, rising to 4.90 from 3.56 at September’s sale.

In another sign of firm investor demand, the tail between the average and the lowest accepted prices slightly tightened to 0.01 from 0.02 at the previous auction.

Following the sale, the five-year yield fell 1 basis point to minus 0.110%.

In the super-long zone, the 20-year JGB yield and the 30-year JGB yield fell half a basis point each to 0.400% and 0.630%, respectively.

The 40-year JGB yield was flat at 0.655%. (Reporting by Tokyo Markets Team; editing by Uttaresh.V)

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