Japan’s 10Y Yield Hits 17-Year High as BOJ Faces a No-Win Policy Setup

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Japan’s 10-year JGB yield touched 1.917% on Thursday the highest level since 2007. It’s basically the market’s way of signaling that investors aren’t fully convinced about the Bank of Japan’s current policy path. The BOJ is stuck between two bad options: Raise rates further: yields likely push even higher, tightening conditions at a time when parts of the economy are still fragile. Cut or stay on hold: risks re-accelerating inflation after spending most of the decade trying to get it under control.It’s one of those situations where any direction introduces new problems. The next BOJ meeting should be interesting because the window for “gentle normalization” looks like it’s narrowing fast.

Source: https://www.cnbc.com/2025/12/04/japan-record-high-jgb-yields-boj-policy-rate.html?__source=androidappshare

Japan’s economy really is something.

Negative interest rates, the yen carry trade nonsense, bonds lasting 4 goddam decades yielding sub 1% (historically).

The BOJ having owning over 50% of the bond market.

The BOJ owning over 80% of all Japanese ETFs.

Its like a funhouse of numbers.

h/t KingoPants