Japan's Bond Yields Soar to 1996 High Amid Global Treasury Rout
Japan's 10-year government bond yield reached its highest level since 1996 on Thursday, following a global sell-off in Treasuries. The yield climbed to 3.075% after the Silver Week holidays, a rise of 10 basis points from the previous day.
The increase was part of a broader trend, with yields across the curve rising as well. The five-year rate increased by 9.5 basis points to 2.37%, reflecting concerns over inflation and further interest-rate hikes by the Federal Reserve in the US.
The Bank of Japan (BOJ) raised its benchmark rate last Friday and left open the possibility for further tightening, but traders were disappointed by the lack of clear guidance on future moves.
Katsutoshi Inadome, a senior strategist at Sumitomo Mitsui Trust Asset Management, warned that the BOJ risks falling behind the curve on inflation if it doesn't act swiftly. His comments came after two dissents against last week's rate increase and no proposal for a larger 50-basis-point move.