FX.co ★ Japan 10-Year Yield Holds Steady Despite GDP Miss

Japan's 10-year government bond yield remained near 1.47% on Friday, close to its highest point in six weeks, as investors considered lackluster GDP data alongside expectations for continued policy adjustments. In the first quarter, the Japanese economy contracted by 0.2% on a quarter-on-quarter basis, marking its first decline in a year—a sharper drop than the projected 0.1%. Nonetheless, the Bank of Japan reaffirmed earlier this week its anticipation that upward pressures on wages and prices will persist, thereby underscoring its commitment to gradually tighten monetary policy. Market participants are also focused on the progress in US-Japan trade discussions, with Tokyo striving to reach a deal by June. Prime Minister Shigeru Ishiba has stressed that any agreement must address automobile provisions and has urged Washington to eliminate its 25% tariff on Japanese vehicles.