JGBs gain slightly after industrial production worsens in July, unemployment rate disappoints investors

Japanese government bonds slightly gained on the last trading day of the week Friday after the country’s unemployment rate and industrial production for the month of July, both disappointed market sentiments, forcing buyers into safe-haven instruments.

The yield on the benchmark 10-year JGB note, which moves inversely to its price, slipped 1/2 basis point to 0.105 percent, the yield on the long-term 30-year note flat at 0.850 percent and the yield on short-term 2-year remained tad lower at -0.109 percent by 05:15GMT.

According to a report from Reuters, Japan’s seasonally adjusted unemployment rate rose to 2.5 percent from 2.4 percent in July, and compared with economists’ median forecast of 2.4 percent, figures from the Ministry of Internal Affairs and Communications showed. The jobs-to-applicants ratio rose to 1.63 from 1.62 in June, hitting the highest level since January 1974, separate data from the Ministry of Labor showed. The median forecast was for 1.62.

A separate report from the Ministry of Trade showed that factory output fell 0.1 percent in July from the previous month, undershooting economists’ median estimate of a 0.2 percent rise, following declines of 1.8 percent in June and 0.2 percent in May.

Meanwhile, the Nikkei 225 index closed flat at 22,871.00, while at 05:00GMT, the FxWirePro's Hourly JPY Strength Index remained neutral at 17.87. For more details, visit http://www.fxwirepro.com/currencyindex