Aug. 17 at 6:50 AM
$GOOGL : Euphoria in a blind market!
The Japanese bond market is undergoing a historic transformation. After years of zero interest rates and massive central bank purchases that depressed yields, investors are now facing a new reality of higher interest rates, a weak yen, imported inflation and rising energy prices. The Japanese bond market continues to break levels that seemed almost impossible for decades. The yield on 10-year Japanese government bonds climbed to about 2.93%, the highest level since 1996, and is approaching the psychological level of 3%. At the same time, the two-year yield rose to about 1.69%, the highest since 1995, and the 30-year yield is already around 4.06%.
The move does not only affect Tokyo - it may also affect bond markets in the US and Europe, due to the huge volume of investments by Japanese investors outside the country.
