Citing Odaily, Japan's bond market experienced sharp volatility on December 4, 2025, as 30-year yields broke 3.445%, the highest on record, and 10-year yields hit 1.905%, the highest since 2007. The surge was driven by market expectations of a potential Bank of Japan rate hike at its December 18–19 meeting, with derivative data showing over 80% implied probability. The move reflects growing concerns over the sustainability of the Bank’s Yield Curve Control (YCC) policy, which has underpinned global liquidity for over a decade by keeping Japanese rates near zero. Analysts warn that any policy shift could trigger a chain reaction in global carry trades, particularly affecting high-beta assets like tech stocks and cryptocurrencies.
Japan's Long-Term Yen Rates Surge Amid Policy Uncertainty
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