(Bloomberg): Bond prices fell on the 26th. Long-term interest rates rose above 1% for the first time in two weeks. This was the result of the rise in long-term interest rates in the United States, and concerns over a significant reduction in government bond purchases by the Bank of Japan and additional interest rate hikes led to selling.
Takahiro Otsuka, senior bond strategist at Mitsubishi UFJ Morgan Stanley Securities, said that while it does not appear that long-term interest rates will continue to rise, “the market will have a hard time rising until the scale of the reduction in the Bank of Japan’s purchases becomes clear. As the yen has weakened significantly, people are aware that the scale of the reduction will be large, and there is concern that expectations of a rate hike in July are on the rise.”
In a special Bloomberg survey conducted on the 25th, 33 percent of 43 economists who responded predicted that the Bank of Japan would simultaneously implement an additional rate hike at its July monetary policy meeting, when it will decide on a specific plan for reducing its bond purchases.
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Source: Japanese