Japan’s 10-Year Bond Yield Rises to 1997 High on Iran Tensions

Japan’s 10-year government bond yield climbed to its highest level since 1997, as tensions in the Middle East escalated after President Donald Trump said the US will begin a full naval blockade of the strategic Strait of Hormuz.Author of the article:You can save this article by registering for free here. Or sign-in if you have an account.(Bloomberg) — Japan’s 10-year government bond yield climbed to its highest level since 1997, as tensions in the Middle East escalated after President Donald Trump said the US will begin a full naval blockade of the strategic Strait of Hormuz. Subscribe now to read the latest news in your city and across Canada.Subscribe now to read the latest news in your city and across Canada.Create an account or sign in to continue with your reading experience.Create an account or sign in to continue with your reading experience.The benchmark rate rose 5.5 basis points to 2.49% in Tokyo on Monday. Ten-year bond futures fell as much as 55 ticks to 129.27, while the five-year yield gained 4 basis points to 1.9%.Weekend negotiations between Washington and Tehran failed to yield a deal to end the conflict in Iran, dashing hopes that last week’s fragile ceasefire could hold. The renewed tensions have pushed oil prices higher, adding to inflationary pressures in Japan, which is heavily dependent on Middle Eastern energy imports.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Persistent yen weakness is compounding inflation risks by pushing up import costs. The currency is once again approaching the 160-per-dollar level, prompting stronger verbal warnings from Japanese officials.

Finance Minister Satsuki Katayama had said authorities are prepared to take action on all fronts in markets, considering the impact of currency moves on households and the economy.The Middle East tensions “have increased the likelihood that the Bank of Japan will not be able to implement a rate hike at its April meeting,” said Rinto Maruyama, senior FX and rates strategist at SMBC Nikko Securities Inc. “If authorities do not make statements this week to guide the market to price in a rate hike, yields may continue to rise as the market anticipates a ‘behind the curve’ scenario.”Overnight index swaps imply about a 54% probability of a rate hike by April, with a 25-basis-point increase fully priced in by July.(Updates with chart, comment, additional data)Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.365 Bloor Street East, Toronto, Ontario, M4W 3L4© 2026 Financial Post, a division of Postmedia Network Inc. All rights reserved. Unauthorized distribution, transmission or republication strictly prohibited.This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.You can manage saved articles in your account.and save up to 100 articles!You can manage your saved articles in your account and clicking the X located at the bottom right of the article.