By Kosaku NariokaJapan's 10-year government bond yield climbed to an 11-year high on Monday, driven by growing market expectations that the Bank of Japan will take additional steps to tighten policy in the coming months. The 10-year yield rose to 0.975%, its highest level since May 2013. Investors have been speculating about the timing for the Bank of Japan's potential rate increases and a possible reduction in its government-bond purchases. That raised market expectations for a potential reduction in the BOJ's monthly JGB purchases. Goldman Sachs expects the Japanese central bank to raise its policy rate to 1.25%-1.50% by 2027, driven by a gradual but steady increase in inflation expectations.

Source: Wall Street Journal May 20, 2024 10:07 UTC