2023-09-19 04:23:33
Japanese government bond (JGB) yields rose Tuesday, tracking U.S. Treasury yields overnight, as attention turns to a week of central bank meetings that include decisions from the Federal Reserve and the Bank of Japan (BOJ).
U.S. 10-year yields held just below 16-year highs reached last month, ahead of the Federal Reserve meeting on Wednesday. The Fed is expected to leave rates unchanged, but could signal that it is open to further increases. The U.S. yield was last down at 4.3085%.
As the JGB market reopened after a local holiday on Monday, the 10-year JGB yield rose to 0.72%, the near 10-year high reached last week, before falling back to 0.71%.
Japan’s central bank holds its monetary policy meeting on Friday, creating a favorable environment for JGB yields to rise.
Although the BOJ is unlikely to abandon its ultra-tight monetary policy at this meeting, investors will closely watch changes to the central bank’s forecasts, said Takeshi Ishida, a strategist at Resona Holdings.
“If (the BOJ forecast) were changed, even if there is no policy adjustment this time, I think expectations of a possible adjustment next time would increase.
JGB yields rose last week after a local report signaled a possible end to the BOJ’s negative rate policy.
The 20-year JGB yield remained stable at 1.425%.
The 30-year JGB yield rose 1.5 basis points (bps) to 1.685%.
In the short term, the two-year JGB yield increased by 0.5 basis points to 0.03%, while the five-year yield increased by 1 basis point to 0.28%. (Reporting by Brigid Riley; Editing by Janane Venkatraman)
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