By Kosaku Narioka
Japan's 10-year government bond yield climbed to 1.0% for the first time in 11 years on Wednesday, propelled by growing expectations that the country's central bank may tightening monetary policy further in the coming months.
The 10-year yield briefly touched the psychological threshold of 1.0%, its highest level since May 2013. The yield was recently up 1.5 basis points at 0.995%.
Investors have been speculating about the timing of the Bank of Japan's next potential rate increase and a possible reduction in its government-bond purchases after the BOJ ended its negative interest-rate policy and halted much of its unorthodox easing measures in March.
Some analysts say the Japanese central bank might slow its bond-buying partly to support the yen, which has depreciated sharply over the past couple of years as the BOJ maintained its ultra-loose monetary policy while other central banks raised interest rates.
On Monday last week, the BOJ offered to buy a smaller amount of Japanese government bonds maturing in five to 10 years on the following day compared with its previous operation, and maintained the reduced amount on Friday. That raised speculation that it will start winding back its monthly JGB purchases.
On Wednesday, longer-term JGB yields climbed more sharply than the 10-year yield. The 30-year yield was recently 5.5 basis points higher at 2.140%.
Write to Kosaku Narioka at kosaku.narioka@wsj.com
(END) Dow Jones Newswires
05-22-24 0240ET
