In Tokyo’s bond market on the 18th, the yield on newly issued 10-year Japanese government bonds, the benchmark for long-term interest rates, temporarily rose to 2.945%, remaining at a high level for a second consecutive day. Expectations of a BOJ rate hike, fiscal concerns and rising interest rates in overseas markets were cited as the backdrop, while short- and medium-term yields also reached new highs for the period.
In Tokyo’s bond market on the 18th, the yield on newly issued 10-year Japanese government bonds, the benchmark for long-term interest rates, temporarily rose to 2.945%. Prices fell, and the yield was up 0.025 percentage points from the previous day, reaching a nearly 30-year high.
The yield on newly issued 2-year JGBs temporarily reached 1.700%, its highest level in about 31 years, while the yield on newly issued 5-year JGBs temporarily reached 2.180%, an all-time high. Yields rose across a broad range of maturities.
Market expectations grew that the BOJ could raise rates as early as its September monetary policy meeting, heightening attention on a shift in the BOJ’s monetary policy. A sense of caution over the Takaichi administration’s fiscal management also appeared to spur selling of government bonds.
Overseas factors, including concerns over the situation in the Middle East and developments in U.S. markets, also had an impact. The U.S. 30-year Treasury yield temporarily reached the 5.3% range, its highest level in 19 years. These developments are believed to have accelerated selling of Japanese government bonds.