Ketuo Macro: The upward pressure on Japanese government bond yields may ease next year

On November 20th, Jinshi Data reported that Shivaan Tandon, an analyst at Capital Macro, said that Japanese government bond yields may face some upward pressure in the short term, but this pressure should ease next year. He pointed out that the market still seems to have not fully digested the impact of the Central Bank of Japan’s rate hike in December. Tandon expects that the yield on Japanese bonds will fall slightly in the future and stabilize near current levels. ‘We believe that investors’ expectations of more rate hikes next year are somewhat exaggerated,’ the bank believes that the yield on US Treasuries is unlikely to further bring upward pressure on Japanese government bond yields. The bank expects that the yield on 10-year Japanese government bonds will be around 1.0% by the end of next year.