Japanese Government Bonds Rise as AI-Linked Credit Worries Weigh on Markets; 10-Year JGB Yield Falls 3 Basis Points

Deep News10-19

Japanese government bonds advanced in early Tokyo trading as concerns mounted over credit bonds tied to artificial intelligence.

Two members of JPMorgan's Japan market research team said in a research note, "We are watching whether these concerns could become a catalyst that prompts investors to stop overly avoiding duration risk; previously they preferred taking on credit and yield spread risk rather than duration risk."

They added, "Assuming the recent credit concerns do not escalate into a major risk-off event, we maintain the view that the market's excessive pricing of rate hike expectations will first fade at the short end, and longer-term yields will then decline."

The 10-year Japanese government bond yield fell 3.0 basis points to 2.900%.

The 20-year Japanese government bond yield dropped 1.5 basis points to 3.790%.

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