THE JAPANESE TICKING BOND
Japan's 10-year JGB yield could affect risk assets like Cryptocurrencies this weekend, due to the fact that it has shown modest upward pressure over the past week, rising from 1.96% on December 12 to 1.98% on December 17, amid ongoing fiscal concerns and BOJ policy expectations. This month bond traders have run rate 14% already which show how unhappy investors are across financial instruments.
The yield held steady at 1.96% from December 12 through December 16 before climbing 2 basis points to 1.98% on December 17, per Ministry of Finance data. This follows a brief dip to 1.93% on December 11, reflecting market stabilization after earlier surges near 1.97%.On December 18, yields eased slightly to 1.97%, down 2 basis points from the prior session.
Prime Minister Sanae Takaichi's push for proactive fiscal spending to boost growth has heightened worries over Japan's fiscal health, driving yields higher. Inflation above target and hawkish BOJ rhetoric, including potential rate hikes, continue to fuel yield sensitivity. Recent auctions showed resilient demand, but bearish sentiment persists near 1.9% levels.
This uptrend signals normalization risks for regional portfolios, yet affecting liquidity for sensible assets such as $BTC
, Nasdaq and S&P500. With JGB yields now 80% above year-ago levels at 1.09%.
Spillover could unwind yen carry trades, pressuring higher-beta Asian credits like Indonesia or India. BOJ's December policy meeting looms critical; a hike might cap yields below 2%.
