JGB yields rise as market awaits BOJ decision

TOKYO: Japan’s government bond (JGB) yields rose on Wednesday, as investors awaited the Bank of Japan’s policy decision later in the day.

The 10-year JGB yield rose 1 basis point (bp) to 1.51%. The five-year yield rose 1 bp to 1.105%. The two-year JGB yield rose 1 bp to 0.82%.

The BOJ is set to keep interest rates steady on Wednesday’s policy meeting, as policymakers spend more time gauging how prospects of higher US tariffs would affect the export-reliant economy.

“The movement of yields is minimal, which suggests that investors are awaiting the statement from the BOJ and comments from BOJ Governor (Kazuo) Ueda,” said Gen Taniguchi, a market analyst at Mizuho Securities.

“Ueda and other central bank officials have sent hawkish messages to the market. If Ueda’s comments are in line with his previous stance, the market reaction will be limited.”

JGB yields rose to levels last seen more than a decade ago earlier this month as bets escalated that the BOJ would raise its policy rate faster and higher on the back of growing wages and rising prices.

The 10-year JGB yield was at 1.105% in early January and rose to as high as 1.575% in early March. Such bets partially receded as fears emerged that the US economy could fall into recession amid back-and-forth comments on tariffs from US President Donald Trump.

Japan’s 10-year bond yield rises as market awaits BOJ rate decision

With growing global trade tensions casting a shadow over the outlook, market attention falls on any clues about the timing of future rate hikes when BOJ Governor Ueda speaks at a press conference after the central bank’s decision.

The 20-year JGB yield rose 1 bp to 2.27%, while the 30-year JGB yield ticked up 0.5 bp to 2.6%.

The 40-year JGB yield climbed 1.5 bps to 2.98%.