The JGB curve bear-steepened in early Tokyo trade as investors weighed Bank of Japan policy concerns and Japan’s fiscal outlook.
Japan’s 10-year government bond yield rose to 2.810% in early Tokyo trade, its highest intraday level since October 1996, while the JGB curve steepened. The five-year yield fell 1 basis point to 1.920% and the 10-year yield was up 2 basis points at 2.800% after touching the session high, according to Quick. Barclays Securities Japan analysts said the curve has bear-steepened sharply this week on concerns the Bank of Japan may be behind the curve and on worries about Japan’s fiscal outlook. They said investors are likely to keep waiting for details on fiscal spending, including a possible cabinet decision on the government’s draft Basic Policy on Economic and Fiscal Management and Reform.