Japanese 10-year bond yields a 6-week low on higher safe-haven demand, following tensions over Korean Peninsula

The Japanese 10-year government bond yields struck a 6-week high Wednesday after investors poured into safe-haven assets, following growing tensions over the Korean Peninsula as the country prepares to go into a long holiday starting Friday on account of Mountain Day.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.07 percent, the yield on long-term 30-year note traded flat at 0.87 percent and the yield on short-term 2-year too traded steady at -0.10 percent by 05:50 GMT.

The growing tensions in the Korean Peninsula strengthened the demand for the Japanese Yen, gold and the treasuries. The demand for the Yen also spiked after ex-BOJ Kuichi said the central bank may consider policy normalization and may change the 10-year yield target to 3-5 years.

Moreover, the Yen’s safe haven appeal has ensured the spot remains under pressure and ignores the US JOLTs job report, which showed the job openings jumped to a record high in June, outpacing hiring.

Meanwhile, Japan’s Nikkei 225 slumped 1.43 percent at 19,710.50 by 05:10GMT, while at 05:00GMT, the FxWirePro's Hourly Yen Strength Index remained neutral at 26.77 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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