BOJ Rate Hike Bets Send Japanese Bond Yields Soaring

Japan's two-year government bond yield has been rising amid expectations of further interest rate hikes from the Bank of Japan (BOJ). The two-year yield rose as much as four basis points to 1.975% on September 28, its highest level since 1995.

The five-year yield also climbed three basis points to 2.43%, indicating that selling pressure has spread across the Japanese bond market.

Investors are concerned that the BOJ may be moving too slowly in tightening monetary policy, particularly with a hawkish US Federal Reserve threatening to keep interest rates high.