MUFG wades back into Japanese bonds with eye on policy risks
The bank remains concerned that yields could further spike due to fiscal and monetary policies in the nation.
Mitsubishi UFJ Financial Group (MUFG) is cautiously reentering Japan's government bond market, according to Atsushi Yamashita, the chief executive of the bank's global markets division. Yamashita acknowledged the potential for yields to increase further due to fiscal and monetary policies, stating that the bank plans to rebuild its position gradually while closely monitoring interest rates.
He anticipates that Japan's 10-year government bond yields will peak around 3.2%, surpassing the three-decade high of 3.115% observed earlier this month. However, Yamashita expressed concern that yields could rise higher if the Bank of Japan fails to curb inflation or Prime Minister Sanae Takaichi is unable to assure investors of her ability to manage government finances effectively.
In his first interview since assuming his role, Yamashita indicated that the bank does not yet consider the risks of a further yield rise to be fully eliminated.
Written by urgent.news from Japan Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
