Key JGB Yield Hits 29-Year High of 2.600 Pct

Tokyo, May 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, rose to as high as 2.600 pct in Tokyo interdealer trading Wednesday morning. The reading was the highest since June 1997, according to Japan Bond Trading Co. On Tuesday, key U.S. crude oil futures briefly rose above 102 dollars per barrel on growing speculation that the de facto blockade of the Strait of Hormuz will prolong. U.S. government data showed the same day that the country’s consumer price index for April rose 3.8 pct year on year, the sharpest growth in about three years. Long-term U.S. interest rates climbed due to receding expectations for an interest rate cut by the U.S. Federal Reserve amid concerns over inflation. Following the developments in the United States, JGBs came under selling as well on Wednesday. “We can’t buy JGBs as expectations for higher interest rates persist on the back of rising crude oil prices and concerns over Japan’s fiscal health,” an official at an asset management company said. END [Copyright The Jiji Press, Ltd.]