- Japan’s 10-year yield climbed 6 basis points to above 3%, reflecting fiscal concerns and a higher expected BOJ terminal rate.
- The yen traded at 160.1 per dollar after a coordinated U.S.-Japan intervention in late July failed to sustain its gains.
- U.S. officials pressed Tokyo to support the yen, communicate a path toward fiscal sustainability and pursue further rate hikes.
- Renewed U.S.-Iran hostilities also pushed global bond yields higher by reviving inflation concerns.
Quotes
“And it's my belief that the Japanese government and that the BOJ will do the things that will lead to a stronger yen.”
“A 3% 10-year borrowing cost "is high in historical perspective, but it just means another step for Japan in leaving deflation in the past and joining the rest of the world where 2% inflation is an achievable normal,”