FX.co ★ Japan 10Y Yield Eases After Ueda Remarks

Japan’s 10-year government bond yield slipped to around 2.71% on Wednesday after Bank of Japan Governor Kazuo Ueda flagged increasing inflation risks but stopped short of signaling whether rates might be raised at the next policy meeting. Ueda underscored the need to closely monitor how surging oil prices could influence Japan’s underlying inflation trend, while avoiding explicit guidance on how those factors might shape the central bank’s decision next month.

Separately, BOJ Deputy Governor Ryozo Himino reiterated that the central bank remains open to additional interest rate hikes, though he stressed that the timing and pace would hinge on how the conflict in the Middle East ultimately affects Japan’s economic activity and inflation outlook. At the same time, investors continued to follow developments in the region, where tentative signs of progress toward a potential US-Iran agreement were offset by renewed hostilities, keeping geopolitical uncertainty elevated.