Japanese and Australian 10-year yields fell to records, extending a global bond market rally as four polls suggested Britain is on course to leave the European Union.
Investors are rushing to the relative safety of fixed-income securities in case the nation opts out of the union in a June 23 vote, looking past the Federal Reserve’s policy meeting Tuesday and Wednesday.
“The big event will be the Brexit vote,” said Kim Youngsung, the head of overseas investment in Seoul at South Korea’s Government Employees Pension Service, which has $12.8 billion in assets. “There’s a high possibility Brexit will take place. Bond prices will go up again if it happens.”
Japan’s 10-year yield was unchanged at minus 0.165 percent as of 10:41 a.m. in Tokyo Tuesday, after dropping to a record minus 0.17 percent. Australia’s slid to an unprecedented 2.05 percent. Ten-year Treasury yields were little changed at 1.61 percent.