JGBs trade narrowly mixed in subdued session, 10-year yield remains flat at 0.50 pct

Japanese government bonds traded narrowly mixed on Friday as investors remain sidelined in any major trading activity amid a silent session that witnessed no data of major economic significance.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, remained flat at 0.053 percent, the yield on long-term 30-year also fell nearly 1/2 basis point to 0.812 percent and the yield on short-term 2-year hovered around -0.135 percent by 04:50 GMT.

According to the recent Reuters report, caution ahead of a 10-year JGB auction scheduled early in January also pressured the longer-dated maturities. The 10-year JGB yield rose 0.5 basis point to 0.055 percent. The benchmark yield was poised to end the year almost unchanged, having been stuck in a narrow range under the Bank of Japan's yield curve control scheme.

Japan's Nikkei share average rose on its final trading day of the year on Friday as banking shares rebounded, putting the index on track to gain nearly 20 percent in 2017. U.S. Treasury prices dipped on Thursday, giving back some of Wednesday's strong month-end extension rally after the Treasury Department sold USD28 billion of seven-year notes to moderate demand.

In the United States, Treasuries saw downward pressure across the curve during a relatively quiet Thursday session light on economic data of great significance. With respect to data, markets were greeted by little change in the way of weekly jobless claims, holding steady around 245k, coupled with a wider goods trade balance for November, increasing to -USD69.7 billion and a rebound in wholesale inventories up +0.7 percent m/m in November, from -0.4 percent m/m, followed later by solid upward pressure seen from the Chicago PMI measure for December, increasing to 67.6, highest reading since March 2011.

Markets now await what stands to be another relatively quiet session to end 2017 on Friday with little scheduled in the way of economic data.

Meanwhile, Japan’s Nikkei 225 traded 0.05 percent higher at 22,787.00 by 04:50, while at 04:00GMT, the FxWirePro's Hourly Yen Strength Index remained slightly bullish at -69.54 (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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