Japan's 10-year yield falls on risk aversion, debt issuance pledge
TLT•Japan’s benchmark 10-year government bond yield fell 3 basis points to 2.9% as risk aversion and Prime Minister Sanae Takaichi’s pledge to control debt issuance supported bonds.
1. Yields fall
Japanese government bond yields fell as a risk-off mood followed a selloff in U.S. technology stocks. Takaichi said Japan would “appropriately” control the size of its debt issuance.
2. Other maturities
The 20-year yield slid 1.5 basis points to 3.790%, and the two-year yield fell 1.5 basis points to 1.890%. The 30-year yield was unchanged, while the 40-year bond had yet to trade.
3. Inflation outlook
Sony Financial Group chief economist Hiroshi Watanabe said stronger risk aversion was likely to lift bond prices as weakness in U.S. technology stocks spilled over to Japanese AI and chip stocks. Bank of Japan Governor Kazuo Ueda said underlying inflation was “quite close” to the central bank’s 2% target.
