Yen jumps after JGB auction draws big demand, euro finds relief
TLT•The yen rose 0.2% to 158.15 per dollar after demand at Japan’s 20-year government bond auction reached 5.84 times the amount sold, a record and up from 4.01 times last month. The euro gained 0.2% to $1.1234 as French and German bond futures also rose.
1. Record JGB demand
The yen snapped a two-day losing streak in Asian trading after Japan’s 20-year government bond auction drew bids worth 5.84 times the amount sold, compared with 4.01 times at the previous auction. The 20-year JGB yield fell 6 basis points to 3.71%.
2. European currencies rally
The euro rose 0.2% to $1.1234, while French OAT futures gained 0.2% and German bund futures edged up 0.1%. Political unrest in France and Italy continued to weigh on traders’ nerves, while the British pound rose 0.4% to $1.3351.
3. Other currency moves
The Canadian dollar strengthened 0.2% after Alberta residents voted to remain part of Canada. The offshore yuan gained 0.1% after China’s central bank kept interest rates unchanged, in line with market expectations.
