Japanese government bond yields fell sharply on Wednesday as investors scooped up bonds at the start of the new fiscal year, with sentiment aided by optimism for the de-escalation of the Middle East conflict. The five-year JGB yield fell 5.5 basis points to 2.30%, and the 40-year JGB yield fell 12 bps to 3.795%. Bond prices move inversely to yields. "Domestic banks are seen rebuilding their portfolios as the new fiscal year started, and that supported the market today," said Takafumi Yamawaki, head of Japan rates research at J.P. Morgan Securities.