Japan's 2-year government bond yield is approaching the 2% mark for the first time in about 30 years, signaling markets increasingly expect a shift toward sustained inflation and that the Bank of Japan may need to push policy rates toward restrictive levels. The 2-year, the maturity most sensitive to BOJ policy, has doubled over the past 12 months and is now more than six times its level in the same period of 2024. Further BOJ tightening may hinge on Thursday's Tankan corporate survey; Mizuho Fi

Japan's 2-year government bond yield is approaching the 2% mark for the first time in about 30 years, signaling markets increasingly expect a shift toward sustained inflation and that the Bank of Japan may need to push policy rates toward restrictive levels. The 2-year, the maturity most sensitive to BOJ policy, has doubled over the past 12 months and is now more than six times its level in the same period of 2024. Further BOJ tightening may hinge on Thursday's Tankan corporate survey; Mizuho Financial says a strong capital‑expenditure reading would strengthen the case for an October rate hike.