Japan’s 30-Year Bond Yield Nears 3.3% Amid Policy Shift
- Japan's 30-year government bond yield is in the low-to-mid 3% range, marking a shift from the zero-rate period.
- This change follows policy normalization and the end of yield-curve control, allowing long-term premiums to increase.
- Higher domestic yields reduce the appeal of cheap yen funding that previously supported global carry trades and muted volatility.
- The decrease in incentives to keep capital abroad may lead to increased repatriation pressure and reduced global liquidity.
- Key factors to monitor include persistent high long-bond yields, central bank balance-sheet guidance, and updates on Japan's external position.
- Sustained pressure on long-term bonds could increase chances of broader cross-asset volatility.
