FX.co ★ Japan 10-Year Yield Rises on Israel-Iran Ceasefire

Japan’s 10-year government bond yield increased to over 1.42% on Tuesday, marking its second consecutive rise. This shift occurred following US President Donald Trump's announcement of a ceasefire agreement between Israel and Iran, which subsequently reduced the demand for safe-haven bonds. Despite Iran's retaliatory action on a US military base in Qatar—an incident resulting in no casualties—markets remained calm, buoyed further by Tehran's decision to refrain from targeting the strategically important Strait of Hormuz. Domestically, investors remained focused on the Bank of Japan’s policy direction. Although the BOJ maintained its benchmark interest rate at 0.5% last week, officials indicated that they are prepared to tighten the policy further, driven by persistent core inflation and firms transferring wage increases to consumer prices.