FX.co ★ Japan 10-Year Yield Slips Following Weak Wage Data

Japan's 10-year government bond yield receded to approximately 1.48% on Thursday, influenced by concerns surrounding the country's economic outlook following a report that revealed a decline in real wages for the fourth consecutive month in April. Persistent inflation continues to surpass wage growth, eroding household purchasing power and casting doubt over Japan’s recovery prospects. The lackluster wage data adds to existing economic uncertainties, particularly as the trade tensions under former US President Trump heighten global trade concerns. These elements are further complicating the Bank of Japan's plans for policy normalization. Meanwhile, BOJ Governor Kazuo Ueda mentioned that the central bank will reassess its bond tapering strategy, considering feedback from market stakeholders. Ueda also pointed out a reduced demand for super-long Japanese government bonds, with an emphasis on the more immediate economic impact of short- and medium-term yields.