Yields on 10-year US Treasury bonds topped 2.5% and hit a three-year high, lifting the dollar to a two-week high.
To prevent those yield increases from spilling over into local bond markets, the Bank of Japan offered to buy an unlimited amount of debt with maturities greater than five years and 10 years.
Although this did not prevent 10-year yields from reaching the upper limit of the Bank of Japan’s monetary policy band, it did cause the yen to sink.
The dollar rose 2% against the yen after hitting 124.65 yen, the highest level since August 2015 and the biggest one-day gain since March 2020. The yen’s losses in March exceed 7% and the currency is headed for its biggest monthly and quarterly falls since 2016.
The Japanese currency also lost ground against the euro, increasingly underpinned by expectations that the European Central Bank will join the rate-hiking club this year. The euro was up 1.7% at 136.9 yen, its highest in four years.
The Money markets are now forecasting a 60 basis point rate hike this year, which has allowed the euro to recoup losses against the greenback and trade flat on the day at $1,098..
Source: Ambito
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
