JGBs gain tracking U.S. Treasuries as risk aversion rises after U.S. President Trump calls off North Korea talks

Japanese government bonds gained during late Asian session Friday on a rise in risk aversion after the United States’ President Donald Trump called off the talks with North Korea amid a continued decline in the Turkish Lira that added fuel to the ongoing global uncertainties.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, remained tad lower at 0.04 percent, the yield on the long-term 30-year note slipped 1/2 basis point to 0.74 percent and the yield on short-term 2-year hovered around -0.13 percent by 05:10GMT.

U.S. Treasury yields fell on Thursday on safety buying after President Donald Trump called off a planned summit with North Korean leader Kim Jong Un and as the Turkish lira renewed its decline. Trump cited Pyongyang's "open hostility," and warned that the U.S. military was ready in the event of any reckless acts by North Korea, Reuters reported.

Turkey's lira weakened more than 3 percent on Thursday, giving up a large chunk of the gains it made after the central bank raised interest rates by 300 points a day earlier, as investors bet another hike would be needed to tame the sell-off.

Meanwhile, the Nikkei 225 index traded 0.22 percent higher at 22,485.50 by 05:15 GMT, while at 05:00GMT, the FxWirePro's Hourly JPY Strength Index remained highly bullish at 168.10 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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