Japan's Surging 30-Year Yield Is Flashing Warning Sign for Risk Assets: Macro Markets
Main Idea
The surge in Japan's 30-year government bond yield signals potential volatility in global bond markets, which could impact risk assets including cryptocurrencies.
Key Points
1. The yield on Japan's 30-year government bond (JGB) surged over 30 basis points, exceeding 3% for the first time since May 23, 2025.
2. The rise in Japanese ultra-long bond yields may contribute to increasing yields in the U.S. and other countries, affecting risk assets like bitcoin.
3. Crypto investors are advised to monitor the MOVE index, which tracks U.S. Treasury note volatility, as historical trends show correlations with bitcoin price tops.
4. Upcoming auctions of 20-year bonds by Japan's Ministry of Finance could further increase volatility in bond markets.
5. Japan's shift away from being a source of low interest rates since 2023 has altered its role in global carry trades.
Description
The yield on the superlong Japanese debt has surged significantly since Friday, warning of volatility in bond markets across advanced nations. This situation typically leads to financial tightening and zaps investors' risk appetite. The yield on the Japanese 30-year government bond (JGB) has surged over 30 basis points (bps), topping the 3% mark for the first time since May 23, when it hit a high of 3.20%, according to data source TradingView. The 40-year yield has risen nearly 15 basis points t...
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