JGB curve steepens amid worries about Japan's financial health

TOKYO, April 11 (Reuters) - The yield curve on Japanese government bonds (JGBs) steepened on Friday as investors sold super-long maturities amid worries about Japan's financial health, as the country seeks measures to cope with the impact of U.S. tariffs.

The 20-year JGB yield JP20YTN=JBTC rose 6 basis points (bps) to 2.365% and the 30-year yield JP30YTN=JBTC rose 6 bps to 2.72%.

The five-year yield JP5YTN=JBTC slipped 7.5 bps to 0.85%. and the two-year JGB yield JP2YTN=JBTC fell 5 bps to 0.625%.

The spread between the five-year and 30-year JGBs JP5JP30=RR grew to 187 basis points, the widest since 2013, LSEG data showed.

"The wider gap shows weak demand for the longer-dated as the market is worried about the government spending," said Katsutoshi Inadome, a senior strategist at Sumitomo Mitsui Trust Asset Management.

"Also, liquidity is low around the super-long dated bonds, which means even a sell-off moves the yields a lot."

Local media reported that Japanese political parties, including the Liberal Democratic Party, are considering taking measures to fend off the impact of U.S. tariffs, including a reduction in consumer tax and subsidies to individuals.

The escalating Washington-Beijing trade war drove fears of a deep recession, even as U.S. President Donald Trump suddenly paused his 'reciprocal' tariffs on other countries less than 24 hours after they came into effect.

The benchmark 10-year JGB yield JP10YTN=JBTC slipped 1.5 bps to 1.355%.