(Adds comments, update yield movements)
TOKYO, March 16 (Reuters) - Japanese government bond
yields fell on Thursday, tracking U.S. Treasury yields, which
fell as Swiss bank Credit Suisse became the latest focal point
for fears of a banking crisis.
Japan's 10-year JGB yield fell 4 basis points
(bps) to 0.280%. The 20-year JGB yield fell 4
bps to 1.035%, despite a weak outcome of an auction for the
notes with the same maturity.
Japanese yields began falling sharply after the Bank of
Japan (BOJ) maintained its ultra-low policy last week and
extended the declines after Silicon Valley Bank's meltdown and
Credit Suisse's woes.
The BOJ had been struggling to contain elevated yields as
the change in its leadership drove speculation for a further
tweak in the central bank's policy.
"If the U.S. economy faces imminent risk for recession,
expectations that the BOJ would tweak its yield curve control
(YCC) policy will recede," said Ataru Okumura, strategist at
SMBC Nikko Securities.
But if the risks are to be removed and the U.S. Federal
Reserve will continue its rate hikes, Japanese yields may be on
upward trend, he said.
U.S. Treasury yields slumped overnight as concerns on the
bank's fate worsened as Credit Suisse's largest shareholder said
it could not provide further support to the bank.
Japan's two-year JGB yield fell 2 bps to
-0.075%, while the five-year yield fell 2 bps to
0.105%.
The 30-year JGB yield fell 1 bp to 1.265%.
The 40-year JGB yield rose 0.5 bps to 1.505%.
Benchmark 10-year JGB futures rose 0.72 yen to
148.44, with a trading volume of 21,483 lots.
(Reporting by Junko Fujita; Editing by Janane Venkatraman)
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