FX.co ★ Japan 10-Year Yield at 30-Year High

Japan’s 10-year government bond yield edged toward 3.1% on Monday, holding at its highest level since 1996, as ongoing worries over energy-driven inflation strengthened expectations that the Bank of Japan may accelerate its rate-hike cycle. Oil prices advanced after President Donald Trump rejected Iran’s latest proposal to reopen the Strait of Hormuz, while Tehran insisted it would not soften its conditions for restoring traffic through the critical waterway. At the same time, a former BOJ official suggested the central bank could raise its benchmark rate for a second straight month at its October meeting, citing elevated inflation risks. Minutes from the BOJ’s July meeting likewise showed policymakers stressing the need for preemptive action against upside inflation risks to avoid more abrupt rate increases later, while noting that the policy rate remains below its neutral range.