TOKYO, June 10 (Reuters) – Japanese government bond (JGB) prices rose on Monday, with 40-year bond yields falling to their lowest since mid-2016 after soft U.S. payrolls data last week cemented expectations that the Federal Reserve would cut interest rates later this year.

The benchmark 10-year JGB yield shed one basis point to minus 0.130%. The 20-year yield dropped two basis points to 0.24%, while the 40-year yield dipped 2.5 basis points to 0.415%.

Yields on short-dated maturities were easier. The five-year yield dropped 0.5 basis point to minus 0.235%.

Ten-year JGB futures gained 0.11 points to 153.54, with a trading volume of 45,883 lots by mid-afternoon trade.

U.S. Treasury yields tumbled on Friday, with 10-year yields hitting their lowest since September 2017 after a

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