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2026-04-17 10:29:10
[Japanese short-term bond yields expected to fall weekly as interest rate hike expectations weaken] (1) Market expectations for a rapid interest rate hike by the Bank of Japan have weakened, and Japanese short-term bond yields are expected to fall weekly. Although the two-year yield rose 1 basis point to 1.365%, it is expected to record its first five consecutive trading days of decline in a month; the 10-year yield rose 1 basis point to 2.410%. (2) Previously, interest rate swaps showed a greater than 50% probability of an April rate hike, but recent signals from central bank officials have lowered expectations (the Middle East crisis has led to increased energy import costs, which may slow the economy), and the probability is now only 20%. Bank of Japan Governor Kazuo Ueda said that the reality of low real interest rates must be considered when deciding on a rate hike. (3) Analysts pointed out that the rise in long-term US interest rates may spread to the Japanese bond market, bringing selling pressure; the weakening of interest rate hike expectations has also exacerbated the selling pressure on the yen. In addition, the yields of 20-year, 30-year, and 40-year bonds all fell.
