FX.co ★ Japan Bond Yields Fall after 30-Year Auction

Japan's 10-year government bond yield declined to 1.46%, marking its lowest point in about a week, while the 30-year yield slipped to 2.88% following stronger-than-expected demand at a recent 30-year bond auction. Earlier this week, robust interest in a 10-year bond auction also contributed to easing pressure across the broader bond market. In late May, yields had experienced a notable surge, with the 10-year yield nearing levels not seen since 2008 and the 30-year yield reaching record highs. This spike in yields was driven by investor concerns over the sustainability of the government's borrowing strategy as the Bank of Japan gradually retreats from the bond market. In reaction to the sharp rise in yields, reports suggest that the Ministry of Finance is considering a reduction in the issuance of super-long bonds. Meanwhile, Bank of Japan Governor Kazuo Ueda has indicated that the central bank is likely to continue decreasing the pace of Japanese Government Bond purchases in the upcoming fiscal year.