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Investors are driving up Japanese government bond yields at the fastest pace in almost 11 months, and the move may continue before two auctions this week amid concern the nation may face a credit-ratings downgrade.

The yield on the benchmark 10-year security touched 1.065 percent Monday, the highest since Sept. 2. The rate added 8.5 basis points last week, the biggest five-day gain since the week that ended Jan. 7, according to Japan Bond Trading Co., the nation’s largest interdealer debt broker. Ten-year U.S. yields fell 4.7 basis points last week to 1.96 percent.

Twenty-year bonds fell the most since May on Nov. 25, the day after Standard & Poor’s said it may be closer to lowering Japan’s grade as Prime Minister Yoshihiko Noda’s administration isn’t improving the nation’s finances. The International Monetary Fund said there’s a risk a “sudden spike” in yields may make the country’s borrowings unsustainable. Japan is planning two- and 10-year note auctions this week.

“Given how the sentiment quickly deteriorated over the past couple of days, the government bond market is likely to be unstable unless it gets results at the 10-year sale,” Shinji Nomura, chief debt strategist in Tokyo at SMBC Nikko Securities Inc., one of the 25 primary dealers obliged to bid at government-debt sales, said Friday. “Shorter-term bonds will be bought instead as a refuge, steepening the yield curve.”

The government plans to sell ¥2.7 trillion in securities maturing in December 2013 at auction Tuesday and offer ¥2.2 trillion of December 2021 notes Thursday.

Investors bid for 4.07 times the two-year notes at the last sale on Oct. 26, the highest bid-to-cover ratio for such debt since July. The Nov. 1 sale of 10-year, 1 percent bonds drew the strongest demand since April as the bid-to-cover reached 3.26.

Twenty-year yields rose 2.5 basis points to 1.815 percent Monday after gaining six basis points on Nov. 25. A basis point is 0.01 percentage point.

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