Japan’s five-year bond yields rise ahead of first auction after PM Ishiba’s resignation
- The five-year yield rose 2.5 basis points (bps) to 1.120%
TOKYO: Japanese five-year government bonds fell on Wednesday ahead of a sale of the securities, the first debt auction since the resignation of fiscally hawkish Prime Minister Shigeru Ishiba.
The five-year yield rose 2.5 basis points (bps) to 1.120%.
The 10-year yield increased 2 bps to 1.580%. Yields rise when bond prices fall.
The Ministry of Finance will sell about 2.4 trillion yen ($16.28 billion) in five-year JGBs later in the day.
Yields on JGBs, particularly long-dated bonds, have surged of late due to global concerns about fiscal deficits and as pressure mounted on Ishiba from within his Liberal Democratic Party (LDP) to step down following a poor election showing in July.
Ishiba announced on Sunday that he would resign, setting up a leadership race within the LDP that will also determine Japan’s next prime minister.
Among top contenders is Sanae Takaichi, a devotee of “Abenomics” policies of Shinzo Abe - Japan’s long-time leader and former PM, who presided over massive stimulus and unprecedented monetary easing.
The two-year JGB yield rose 2 bps to 0.855%.
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