Japan’s 10-year government bond yield has surged to approximately 0.92%, marking a one-month peak as it tracks the recent upswing in US Treasury yields. This increase follows robust US jobs data that has diminished the likelihood of impending interest rate cuts from the Federal Reserve. Market participants have now dismissed the possibility of a 50 basis point rate cut in November, while assigning a 95% probability to a more conservative 25 basis point reduction.
In Japan, newly appointed Prime Minister Shigeru Ishiba and his economy minister Ryosei Akazawa have urged caution regarding additional interest rate hikes in light of the current economic climate. Their remarks, combined with the strong US economic data, have contributed to a significant dreciation of the yen, prompting fresh verbal warnings from authorities.
As of Monday, October 7, the Japan 10-Year Bond Yield stood at 0.93%, according to over-the-counter interbank yield quotes for this bond maturity. Analysts project that the yield will trade at approximately 0.81% by the end of this quarter and may decline further to 0.69% within the next 12 months.