Demand at Japan's 40-year government bond auction was the strongest since 2020,
with a bid-cover ratio of 3.10 versus 2.82 at the previous sale and a 12-month
average of 2.67. JGB futures rose after the auction; the 40-year yield stood at
4.23%. The sale took place as investors increasingly worry the Bank of Japan may
lag in policy tightening. BOJ Governor Ueda, after a rate hike widely expected
by markets earlier this month, gave no clear guidance on the future pace of
increases, heightening market bets that the BOJ may ultimately need to tighten
more aggressively.
