FX.co ★ Japan 10-Year Yield Hits Fresh 30-Year High

Japan’s 10-year government bond yield rose to about 3.06% on Thursday, its highest level since August 1996, mirroring a surge in US Treasury yields. Strong US private-sector activity data reinforced expectations of further Federal Reserve rate hikes, while a weak auction of five-year Treasury notes deepened the global bond selloff. At the same time, uncertainty over US-Iran negotiations kept oil prices elevated, adding to inflationary pressures.

In Japan, S&P Global data indicated that manufacturing growth in September slowed to a seven-month low, reflecting more modest increases in both output and new orders. Last week, the Bank of Japan raised interest rates in a widely expected decision, with two policymakers dissenting. Governor Kazuo Ueda reaffirmed that the central bank remains committed to further rate increases and to adjusting the degree of monetary accommodation as economic conditions evolve.