JGB yields rise to 9-month high, feeling the tug of U.S. Treasuries

(Updates prices, adds BOJ Governor Kuroda quotes)

TOKYO, Nov 18 (Reuters) - Japanese government bond yields rose to nine-month highs on Friday, feeling the strong tug of their surging U.S. counterparts, in developments expected to test the Bank of Japan's (BOJ) resolve to control the yield curve.

The benchmark 10-year JGB yield was up 3 basis points at 0.035 percent after briefly rising to 0.040 percent, its highest since Feb. 9. The yield had climbed to 0.035 percent midweek before the BOJ conducted on Thursday a fixed-rate JGB buying operation for the first time and prevented the yield from rising further.

The central bank in September embarked on a yield curve control scheme in a bid to keep the benchmark yield around zero percent.

"The BOJ will continue to take steps to ensure the yield curve remains in the shape needed to meet our 2 percent inflation target," BOJ Governor Haruhiko Kuroda told parliament on Friday.

"The BOJ is prepared to conduct fixed-rate operations in an unlimited amount if needed," he said.

Ten-year JGB futures fell 0.41 point to 150.30, posting their biggest weekly fall since May 2013 as the market felt the force of the slide in the prices of U.S. Treasuries.

The five-year yield was up 1 basis point at minus 0.095 percent, while the 30-year yield climbed 4 basis points to 0.600 percent. The 40-year yield touched an eight-month high of 0.700 percent.

The benchmark 10-year Treasury yield rose to an 11-1/2-month high of 2.339 percent on Friday after strong data added to inflation expectations and as Federal Reserve Chair Janet Yellen signalled that the central bank will likely hike rates in December.

(Reporting by the Tokyo markets team; Editing by Jacqueline Wong)

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