Japan 10Y Bond Yield Hits 4-week Low

Japan’s 10-year government bond yield fell to around 2.17% on Tuesday, hitting a one-month low amid easing concerns about the impact of Prime Minister Sanae Takaichi’s policies on the country’s fiscal health. Top fund manager Mark Nash purchased 10-year JGBs after closing a long-held short position, citing reduced political uncertainty following Takaichi’s decisive general election victory. Meanwhile, former Bank of Japan board member Saiji Adachi said on Monday that the central bank is likely to raise its benchmark rate in April, with sufficient data expected by then to support a move. BOJ Governor Kazuo Ueda also said that Prime Minister Sanae Takaichi made no specific requests during their regular meeting on Monday, providing reassurance amid market concerns that she might obstruct the BOJ’s policy normalization.

Japan 10 Year Government Bond Yield decreased to 2.18%, the lowest since January 2026. Over the past 4 weeks, Japan 10Y Bond Yield lost 8.81 basis points, and in the last 12 months, it increased 74.70 basis points.

Japan’s 10-year government bond yield remained around 2.2% on Monday as investors absorbed data showing that fourth-quarter 2025 economic growth came in much weaker than expected. The economy expanded just 0.1% quarter on quarter in Q4, rebounding from a 0.7% contraction in Q3 but falling short of forecasts for a 0.4% increase. Consumer spending, the largest component of GDP, rose only 0.1%, highlighting soft domestic demand as households continued to contend with high inflation. Prime Minister Sanae Takaichi recently reaffirmed her commitment to boosting growth through proactive fiscal measures following her landslide victory in the Feb. 8 Lower House election. She reiterated plans to cut the 8% sales tax on food for two years and pledged that the finance ministry of Japan will not issue new bonds to cover the spending gap. Instead, her administration intends to fund initiatives through a mix of subsidies, special tax measures, and non-tax revenues in a “sustainable” manner.