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Japan's short-end yields rise after surprise gain in U.S. consumer prices

Japan's short-end yields rise after surprise gain in U.S. consumer prices

Reuters · 09/13/2022 21:39
Japan's short-end yields rise after surprise gain in U.S. consumer prices

- Yields on short-end Japanese government bonds climbed in early deals on Wednesday, after an unexpected rise in U.S consumer prices fuelled bets for more aggressive Federal Reserve rate hikes to contain soaring inflation.

U.S. consumer prices rose in August and underlying inflation accelerated amid rising costs for rents and healthcare, giving the Fed ammunition to deliver a third 75-basis-point interest rate hike Wednesday.

"The outcome... was fairly shocking to investors, who have been witnessing other strong economic data," said Ataru Okumura, a strategist at SMBC Nikko Securities.

"There is a caution that the Fed would have to tighten its grip if it wants to contain inflation to 2%."

The two-year JGB yield JP2YTN=JBTC rose 1 basis point to -0.070% and the five-year yield JP5YTN=JBTC rose 2 basis points to 0.050%.

Overnight, U.S. Treasury yields surged and a recession warning - the yield curve inversion - widened, with the yield on two-year Treasury US2YT=RR spiking to an almost 15-year high. US/

In Japan, other were traded yet. The 10-year JGB yield JP10YTN=JBTC remained at 0.240%, while the 20-year JGB yield JP20YTN=JBTC was at 0.870%.

The 30-year JGB yield JP30YTN=JBTC stayed at 1.220% and the 40-year JGB yield JP40YTN=JBTC was at 1.380%.

Benchmark 10-year JGB futures 2JGBv1 fell 0.55 point to 148.54, with a trading volume of 7,438 lots.


(Reporting by Junko Fujita; Editing by Subhranshu Sahu)

((813-4563-2711, junko.fujita@thomsonreuters.com, Reuters Messaging:junko.fujita.reuters.com@reuters.;))