JGBs fall, U.S. jobs outlook raises recovery hopes

TOKYO, March 4 (Reuters) – Japanese government bond futures
slipped on Friday after an improved outlook for the U.S. job
market hit Treasuries and lifted shares worldwide, denting
investor appetite for safe-haven government bonds.

* March 10-year futures (2JGBv1: Quote, Profile, Research) were down 0.27 point at
139.27, after having fallen as low as 139.19.

* Futures dropped to their lowest level in almost two weeks
at one stage and broke below the 25-day moving average, which
came in at 139.28 on Friday.

* Players were seen taking a wait-and-see stance ahead of the
February U.S. jobs report due later in the day.

* The U.S. Labor Department will release the report at 1330
GMT. Economists in a Reuters survey forecast that 185,000 jobs
were created in the month compared with 36,000 jobs created in
January.

* The unemployment rate is seen at 9.1 percent, compared with
9.0 percent in the prior month.

* Strong figures from private payrolls processor ADP on
Wednesday raised hopes that Friday’s jobs report could be
stronger than economists’ forecasts.

* In cash bonds, the superlongs, bonds with maturites of over
10 years, fared better than other sectors as investors snapped up
longer maturities after the yield curve steepened the previous
day.

* “Yield curves abroad flattened and medium-dated bonds faced
selling, so this zone might be key. If it weakens, then superlong
bonds might weaken too,” said Shinji Ebihara, fixed-income
strategist of Credit Suisse.

* The benchmark 10-year yield (JP10YTN=JBTC: Quote, Profile, Research) was up 2 basis
points at 1.310 percent, approaching a 10-month high of 1.350
percent struck last month.

* The 20-year yield (JP20YTN=JBTC: Quote, Profile, Research) was up 0.5 basis points at
2.050 percent.

* The five-year yield (JP5YTN=JBTC: Quote, Profile, Research) rose 2.5 basis point to
0.555 percent.

* U.S. Treasuries fell on Thursday as jobless claims data
raised expectations of an improving labor market in coming
months, driving a stock rally that drew investors out of
safe-haven government debt. [US/]

* Japan’s Nikkei average rose on Friday helped by Wall
Street’s gains on expectations for a big rise in U.S. payrolls,
while a weaker yen lifted exporters. [.T]
(Reporting by Akiko Takeda; Editing by Chris Gallagher)