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2026-05-25 11:12:19
[Signs of easing tensions in the Middle East boost Japanese government bonds, yields fall from multi-decade highs] (1) Affected by signs of easing tensions in the Middle East, market concerns about inflation have eased, and Japanese government bonds rose on Monday, with yields further moving away from the multi-decade highs they have recently reached. The 10-year yield fell 5 basis points to 2.710%, after hitting a 29-year high; the 30-year yield fell 5.5 basis points to 3.955%. (2) Japan is highly dependent on imported energy, and the Middle East conflict has pushed up oil prices, putting pressure on the economic and inflation outlook. Last week's reports that Sanae Takashima might introduce a supplementary budget also exacerbated fiscal concerns, further pressuring Japanese government bonds. (3) Ikeda, head of macro research at Nomura Securities, said that there is still great uncertainty in the market about Takashima's commitment to maintaining fiscal discipline, and many investors believe that now is not the right time to buy Japanese bonds, although the current yield level is already attractive and there is limited room for further significant increases; however, he added that Takashima is aware of market concerns and investors may see positive surprises in the next two months.
