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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