The Japanese government is selling 1.75 trillion yen in bonds with a yield higher than last month.

The Japanese government announced on Friday morning the end of the auction for government treasury bonds, after selling 1.75 trillion yen worth of 5-year bonds at an average yield of 0.706%. This followed the government selling these bonds at a yield of 0.562% last month. The coverage ratio for the auction this month was 3.81 times compared to 3.73 times last month.

This came after the yields on Japanese government bonds rose at the beginning of the Asian session on Friday, as the weakness of the yen increased bets on interest rate hikes by the Bank of Japan, while the shift to a hawkish stance by U.S. Federal Reserve Chairman Jerome Powell hurt investor sentiment.

At the beginning of the session, the yield on 10-year Japanese government bonds touched 1.08%, its highest level since July 25, but it fell by approximately 1.86% or 20 basis points at the close to settle at 1.055 points.

The losses in Japanese bonds came as the yen significantly depreciated against the U.S. dollar, with the dollar-yen pair trading down about 0.48% to 155.54 yen, after the pair touched its highest levels since July 23 earlier in the session at 156.744 yen.

Meanwhile, the yield on 5-year Japanese bonds fell by about 7 basis points or 0.99% to close at 0.698%, after rising by 1.5 basis points to 0.705% earlier in the session, hovering near its highest level since November 2009, despite strong demand in an auction for bonds of the same term.