Key 10-Year JGB Yield Hits 27-Year High of 2.490 Pct

Tokyo, April 13 (Jiji Press)–The yield on the most recent issue of 10-year Japanese government bonds, regarded as the country’s benchmark long-term interest rate, briefly rose to as high as 2.490 pct in Tokyo morning trading Monday. The reading was the highest since February 1999, when the key 10-year JGB yield spiked to 2.440 pct, according to Japan Bond Trading Co. At the time, investors rushed to sell JGBs as they were taken aback by the news that the Finance Ministry’s now-defunct Trust Fund Bureau decided to halt purchases of outstanding JGBs from the market. On Monday, JGBs came under selling amid inflation fears stoked by a surge in crude oil prices reflecting uncertainty over the ceasefire between the United States and Iran. The Middle East tensions also led to selling of Japanese stocks and the yen. After agreeing on a two-week ceasefire last week, the United States and Iran failed to reach a deal in their two-day talks held in Islamabad through Sunday to finally end their fighting. U.S. President Donald Trump said after the negotiations that the United States would begin a blockade of the Strait of Hormuz, a major oil chokepoint. Following the developments, key U.S. crude oil futures rose to top 100 dollars per barrel again in off-hours trading. Japan’s benchmark Nikkei 225 stock average gave up over 600 points to stand at 56,287.62 soon after the opening of Monday’s trading. The index of 225 selected issues listed on the Tokyo Stock Exchange’s Prime section recouped some of the loss later and was at 56,439.98 at 11:03 a.m., down 484.13 points, or 0.85 pct, from Friday’s closing. In Tokyo foreign exchange trading, the dollar stood at 159.68-69 yen at 11 a.m. Monday, up from 159.34-34 yen at 5 p.m. Friday, attracting safe-haven buying amid the Middle East tensions. “The (Middle East) situation remains chaotic, denting investor appetite,” an official of a midsize securities house said. END [Copyright The Jiji Press, Ltd.]