Japanese 40-year government bonds rise, with strong demand in the previous bond auction.

The price of Japan's 40-year government bonds has risen, as good demand was seen at the auction of bonds with this maturity, easing concerns surrounding long-term government bonds during times of political uncertainty. The bid-to-cover ratio, a measure of demand levels, was 2.60, compared to 2.127 at the last auction and an average of 2.47 over the past 12 months. After the auction results were announced, the yield on the 40-year government bonds fell by 7 basis points to 3.31%. Earlier this month, Japanese Prime Minister Yoshihide Suga announced plans to step down, leading the market to speculate on who his successor will be and what impact they may have on policies. In addition, the Japanese Ministry of Finance proposed a second reduction in the issuance of longer-term bonds this year in an effort to calm the bond market's volatility. "The results are strong, pushing the yield curve towards a flatter trajectory," said Miki Den, senior interest rate strategist at Sumitomo Mitsui DS Securities.