JGBs slump following U.S. Treasuries on Trump’s tax reform plan

The Japanese government bonds slumped Thursday, following similar moves in its U.S. cousin, after President Donald Trump on Wednesday promised that his newly released tax reform plan would deliver American businesses and families some of the lowest tax rates in nearly a century, and do so with bipartisan support in Congress.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, jumped 2 basis points to 0.07 percent, the yield on long-term 30-year climbed nearly 4 basis points to 0.88 percent and the yield on short-term 2-year traded 1 basis point higher at -0.12 percent by 03:55 GMT.

"This will be the lowest top marginal income tax rate for small and midsize businesses in more than 80 years," Trump said at a tax reform event in Indianapolis, just hours after the release of a much-anticipated joint tax reform plan crafted by the White House and congressional tax-writing committees. CNBC reported.

A proposed 20 percent corporate tax rate, Trump said, would put U.S. business tax rates below the average of other industrialized nations, which the president called "a revolutionary change".

Meanwhile, Japan’s Nikkei 225 traded 0.47 percent higher at 20,361.50 by 03:55GMT, while at 03:00GMT, the FxWirePro's Hourly Yen Strength Index remained neutral at 43.98 (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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