FX.co ★ Japan 10Y Yield Steady After BOJ Decision

Japan’s 10-year government bond yield hovered around 2.47% on Tuesday after the Bank of Japan left its policy rate unchanged at 0.75% for a fourth consecutive meeting, in line with market expectations. Policymakers remained cautious, weighing persistent inflation risks against weakening growth prospects tied to the conflict in the Middle East. Investors also monitored geopolitical developments after Iran submitted a new proposal to the United States, which is currently under review by the White House, though longstanding disputes over Tehran’s nuclear program remain a key obstacle. At the same time, BOJ Governor Kazuo Ueda faces mounting pressure to bolster expectations for a gradual normalization of monetary policy to support the yen, which has come under renewed pressure amid surging oil prices. Any further depreciation of the currency could heighten pressure on the central bank to raise interest rates, particularly if imported inflation accelerates through exchange-rate effects.