FX.co ★ Japan 10-Year Yield Rises on BOJ Hike Bets

Japan's 10-year government bond yield increased to approximately 2.1% on Friday, bouncing back after a brief decline in the previous session. This rise reflects investors' anticipation of additional interest rate hikes by the Bank of Japan. November's data showed an unexpected 2.9% increase in household spending, driven by purchases related to winter and diminishing inflationary pressures. However, Thursday's figures indicated a 2.8% drop in real wages for November, as inflation outpaced wage growth, complicating the BOJ's plans for monetary tightening. Earlier this week, Governor Kazuo Ueda reaffirmed the central bank's intention to continue raising rates if economic conditions and price trends align with their forecasts. In the bond market, a 30-year Japanese government bond auction attracted strong investor interest due to elevated yields, easing some market concerns.