Recession Risk Plus Election Equals Higher Yields: Japan Credit

Japan’s worst economic contraction since early 2011 will raise rather than lower benchmark bond yields, primary dealers say, as politicians jostling for power increase fiscal spending in the world’s largest debtor.

The 10-year rate, now at 0.73 percent and hovering above a nine-year low, may climb to 0.875 percent by the end of March, according to the median forecast compiled by Bloomberg News of 14 primary dealers obliged to bid at government auctions including Citigroup Inc. and Barclays Plc. Similar-maturity Treasury yields are projected to rise to 1.88 percent from 1.61 percent, data compiled by Bloomberg show.