Japan’s 10-year government bond yield climbed to around 3.1% on Thursday, returning to 30-year highs as stronger economic data and hawkish signals from the Bank of Japan reinforced expectations for a faster pace of policy tightening. Central bank data showed manufacturing sentiment in the third quarter reached its highest level in more than eight years, while overall business conditions rose to their most favorable levels in decades. A summary of opinions from the Bank of Japan’s September meeting indicated that policymakers saw a need to accelerate rate increases or bring them closer to the central bank’s target in the near term. Japanese government bonds have also faced sustained selling pressure since the election of Prime Minister Sane Takaichi, amid ambitious spending plans and worsening fiscal conditions. Recent reports suggested that Prime Minister Takaichi would pledge a flexible response to unexpected market movements in a policy speech scheduled for next week.