Yields on Japan's super-long-dated bonds fall after heavy sell-off

TOKYO, April 23 (Reuters) - Yields on super-long-dated Japanese government bonds (JGBs) fell sharply on Wednesday as traders purchased such paper following a heavy sell-off earlier this month that led to the yield curve steepening.

The 20-year JGB yield JP20YTN=JBTC fell 4.5 basis points (bps) to 2.195% and the 30-year JGB yield JP30YTN=JBTC fell 6 bps to 2.68%. Yields move inversely to prices.

"Investors bought back bonds with such maturities after the yield curve steepened after a heavy sell-off. But due to thin liquidity, even a small buy order could make a big swing," said Kentaro Hatono, head of global fixed income at Asset Management One.

The 20-year and 30-year bonds were not traded until after 0600 GMT, suggesting that the market struggled to come up with the right price for the bonds.

"The volatility for the bonds with such maturities has been high amid worries about possible government spending on measures to fend off the impact of the U.S. trade policy," said

Katsutoshi Inadome, senior strategist at Sumitomo Mitsui Trust Asset Management.

Yields on shorter-dated bonds rose on speculation that U.S. Treasury Secretary Scott Bessent may urge the Bank of Japan (BOJ) to raise interest rates to lift the value of the yen, Inadome said.

He may discuss the subject at a meeting with Japanese Finance Minister Katsunobu Kato in Washington this week, he said.

The two-year JGB yield JP2YTN=JBTC rose 2 bps to 0.685%. The five-year yield JP5YTN=JBTC rose 2.5 bps to 0.895% and the 10-year JGB yield JP10YTN=JBTC rose 2 bps to 1.325%.