JPMorgan Chase & Co. Securities raised its year-end forecast for Japan's benchmark 10-year Treasury bond yield to 1.7% from 1.55% at the end of January, believing that U.S. policy may bring various risks, according to Golden Finance. The Bank of Japan is forecast to raise interest rates in June and December, but possible actions from the US could complicate the situation; Tariffs could prevent the Bank of Japan from raising interest rates if they put pressure on global growth, but if Japan is accused of devaluing the yen, it could raise rates in a hurry, Takashi Yamawaki, head of fixed income research, and Hiroki Yamamoto, a strategist, wrote in a March 10 note.
The correlation between ultra-long-term JGB yields and the BoJ's policy rate may disappear; Long-term government bond yields are likely to trade sideways after the Bank of Japan raises interest rates above 1%. JPMorgan also raised its year-end forecasts for the 20-year and 30-year JGB yields to 2.35% and 2.65% from 2.15% and 2.40%, respectively.
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JPMorgan Chase & Co. raised its year-end forecast for the 10-year JGB yield to 1.7% from 1.55%
JPMorgan Chase & Co. Securities raised its year-end forecast for Japan's benchmark 10-year Treasury bond yield to 1.7% from 1.55% at the end of January, believing that U.S. policy may bring various risks, according to Golden Finance. The Bank of Japan is forecast to raise interest rates in June and December, but possible actions from the US could complicate the situation; Tariffs could prevent the Bank of Japan from raising interest rates if they put pressure on global growth, but if Japan is accused of devaluing the yen, it could raise rates in a hurry, Takashi Yamawaki, head of fixed income research, and Hiroki Yamamoto, a strategist, wrote in a March 10 note. The correlation between ultra-long-term JGB yields and the BoJ's policy rate may disappear; Long-term government bond yields are likely to trade sideways after the Bank of Japan raises interest rates above 1%. JPMorgan also raised its year-end forecasts for the 20-year and 30-year JGB yields to 2.35% and 2.65% from 2.15% and 2.40%, respectively.