10-Year JGB Yield Rises to New 29-Year High

Tokyo, July 7 (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 a fresh 29-year high of 2.85 pct in Tokyo trading Tuesday. Investors are increasingly selling JGBs due to concerns about a deterioration in public finances and rising inflation in Japan, as well as higher interest rates in the United States. Prime Minister Sanae Takaichi’s pursuit of aggressive fiscal spending and monetary easing is fueling concern that the Bank of Japan will fall behind the curve on inflation, sending prices soaring. “There is a possibility that the (benchmark) long-term interest rate will exceed 3 pct amid a lack of buying factors,” said an official of a major securities company. At a press conference, Minoru Kiuchi, economic and fiscal policy minister, said that the government would not pursue a lax fiscal policy, while denying news reports that it is trying to guide interest rates lower. In Tokyo stock trading, the country’s benchmark Nikkei 225 index slipped 1,480.73 points, or 2.12 pct, to 68,256.96 due to continued selling of stocks linked to artificial intelligence. END [Copyright The Jiji Press, Ltd.]