ITC – Quick JGBs – Closing in on zero
Quick Bonds – There was a very poor JGB auction overnight, which prompted weakness in the market so that the 10y simple yield hit a high of -0.008%. The Japanese 10y yield has not been sustainably above zero since January.
When looking at 10y yields FX-hedged back into yen, most yields have also risen, although there does appear to be a small break in the relationship with USTs in particular.
See chart below of 10y yields hedged into yields via 3m rolling FX hedge.
10y yields hedged into yen
JGB 10y (white line) vs a yen hedged US Treasury (separate scales)