Japan’s 40-year government bond yield climbed to its highest in 16 years amid a surge in global yields as traders reassess the U.S. Federal Reserve’s rate cut path.
The yield climbed 1.5 basis points to 2.535% in early trading in Tokyo on Wednesday. Bonds are slumping globally, with the 10-year Treasury yield topping 4.2% for the first time since July. The selloff has extended to German securities, as well as to other government bonds in Asia.
With global bond yields continuing to climb, "there is still a risk of yields rising in Japan,” said Katsutoshi Inadome, senior strategist at Sumitomo Mitsui Trust Asset Management, noting that the depreciation of the yen is also adding to the pressure.
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