Japan’s 10-year government bond yield fell to around 2.89% on Tuesday, extending its retreat from 30-year highs as the yen climbed to a seven-month high. The stronger currency can reduce import costs and ease inflationary pressure. The yen’s rally has been driven by the unwinding of carry trades, expectations of capital repatriation and growing US political pressure for Japan to support the currency through tighter monetary policy. Markets expect the Bank of Japan to raise interest rates this month. An economic adviser to Prime Minister Sanae Takaichi said the central bank is likely to raise rates in September and deliver another increase by January next year. Japanese wages also rose at their fastest pace since 1997, while second-quarter GDP growth was revised higher, strengthening expectations for a more hawkish BOJ policy stance.