Key facts
- Japan's super-long bond yields surged on Monday.
- The 20-year JGB yield reached a 26-year high.
- Concerns over expansionary fiscal policy under Prime Minister Sanae Takaichi contributed to the rise.
- Middle East conflict-driven inflation fears also pushed yields higher.
- Meiji Yasuda Life Insurance plans to double its buying of super-long government bonds in the fiscal year ending March 2027.
Japan's super-long dated government bond yields surged on Monday, driven by deepening concerns over increasingly expansionary fiscal policy and rising inflation fears exacerbated by the Middle East conflict. The 20-year Japanese government bond yield reached its highest level in 26 years, climbing 3.5 basis points to 2.750%. The 30-year JGB yield rose 5 basis points to 3.260%, and the 40-year JGB yield jumped 5 basis points to 3.595%. Broader concerns about the conflict in the Middle East pushing up oil prices and stoking inflation also contributed to the rise in super-long yields. The nation's 30-year bond yield was up nine basis points to 3.79%, and the 40-year rate climbed as much as 11 basis points to 4.02%, both nearing record highs hit in January. In contrast, shorter-term bond yields declined alongside global peers amid worries that the conflict could derail global economic growth. Meiji Yasuda Life Insurance Co. aims to buy more than ¥2 trillion ($12 billion) of super-long Japanese government bonds in the fiscal year ending March 2027, doubling its earlier purchase plan, viewing current yield levels as desirable.