FX.co ★ Japan 10-Year Yield Rises on Political Uncertainty

Japan's 10-year government bond yield increased to approximately 2.28% on Tuesday, recovering from a one-week low amid political uncertainty as campaigning for the snap election for the lower house commenced. Prime Minister Sanae Takaichi experienced a minor decline in approval ratings. Her decision to call the election with the aim of consolidating power and increasing government expenditure has raised concerns regarding Japan's fiscal outlook. In terms of monetary policy, the Bank of Japan maintained its interest rates unchanged last week after elevating them to a 30-year high of 0.75% in December. The central bank emphasized its willingness to further increase rates if economic and inflationary targets are achieved, while also adjusting its inflation forecasts upward.