JGB yields edge up across curve as stimulus hopes continue

TOKYO, Aug 20 (Reuters) - Japanese government bond yields edged higher across the curve on Tuesday due to a calmer tone in world markets and continued expectations for fresh stimulus measures in major economies.

The benchmark 10-year JGB yield added half a basis point to minus 0.230%, while the 20-year and the 30-year yields rose one basis point each to 0.105% and 0.210%, respectively.

Key 10-year JGB futures dropped 0.02 point to 154.83, with a trading volume of 17,345 lots by late afternoon trade.

Tuesday's 0.9 trillion yen ($8.5 billion) 20-year JGB auction attracted moderate investor interest. The auction bid-to-cover ratio, a gauge of demand, dropped to 3.81 from 4.89 at the previous sale last month.

On Monday, Treasury bond yields gained as risk sentiment improved and after the U.S. government said it was gauging market interest in ultra-long debt, with benchmark 10-year yield rising to 1.598%, moving further away from Thursday's three-year low.

Hopes for additional stimulus were rising after reports that Germany is prepared to increase fiscal spending, and after the People's Bank of China (PBOC) took steps to lower corporate borrowing costs. ($1 = 106.5800 yen) (Reporting by the Tokyo markets team; editing by Uttaresh.V)

Copyright © Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.

News, commentary and research reports are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.