The yield on the Japan 10-year JGB has been trading around the Bank of Japan's implicit policy cap of 0.25% since mid-September, despite sharp moves from overseas peers, as the Bank of Japan has pledged to maintain its ultra-easy stance on monetary policy. The BoJ has been spending trillions of yen to preserve the ceiling on the former as part of efforts to keep borrowing costs low and stimulate the economy. At the end of September, the market value of the BoJ's government bond holdings fell to JPY 544,646.2 billion, the first unrealized loss on government bonds since 2006 and the largest since 1998, due to a rise bond yields. However, some investors start to bet the BoJ will change monetary policy in the short-term, with BoJ Governor Haruhiko Kuroda saying that “tightening labor market will help drive up wages ahead". The Governor has constantly insisted on the need to maintain the bank's massive stimulus until wages rise enough to make up for the rising cost of living.
Historically, the Japan Government Bond 10Y reached an all time high of 7.59 in June of 1984. Japan Government Bond 10Y - data, forecasts, historical chart - was last updated on November of 2022.
The Japan Government Bond 10Y is expected to trade at 0.27 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 0.35 in 12 months time.