Japan sells JPY 400bln in 40-year JGBs; b/c 2.76x (prev. 2.59x), highest accepted yield 3.720% (prev. 3.555%)

Japan's recent auction of 40-year JGBs saw strong demand with a bid-to-cover ratio of 2.76, indicating investors are actively seeking longer-duration bonds despite a rise in the highest accepted yield to 3.720%. This increase in yield could reflect growing concerns about inflation or a shift in monetary policy expectations. Overall, the strengthened demand suggests a solid appetite for fixed income, although the declining price signals that the market is adjusting to the higher yield environment.