TOKYO: Japanese government bond yields rose on Monday, as signs of progress in US-China trade negotiations bolstered investors’ risk appetite, prompting a sell-off in safe-haven assets.
The 10-year JGB yield touched 1.4%, its highest since April 10, and was last at 1.38%, up 3 basis points (bps) from the previous session.
“Investors’ risk appetite was lifted after they saw signs of progress in the talks between the United States and China,” said Katsutoshi Inadome, a senior strategist at Sumitomo Mitsui Trust Asset Management.
“The market still has not seen development of talks between Japan and the US, but the fate of the talks between China and the United States is important.”
Over the weekend, US Treasury Secretary Scott Bessent touted “substantial progress” in trade discussions, while Chinese officials said the sides had reached “important consensus” and agreed to launch another new economic dialogue forum.
Geopolitical tensions also looked to be easing as a fragile ceasefire held between India and Pakistan, while Ukrainian President Volodymyr Zelenskiyy said he was ready to meet Vladimir Putin in Turkey on Thursday for talks.
JGB yields with super-long maturities jump ahead of auction
The five-year yield rose 3 bps to 0.91%, while the two-year JGBs were not traded, as of 0542 GMT.
The 20-year JGB yield rose to 2.4%, its highest since April 15, and was last up 5 bps at 2.39%.
The 30-year JGB yield jumped 5 bps 2.955% ahead of an auction for the bonds with the same maturity on Tuesday. The 40-year JGB yield rose 4.5 bps to 3.435%.
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