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Inflation Irks Asia as Japan Yields Hit Six-Year High, BOK Hikes

  • JGB 5-year yields climb as BOJ said to be mulling higher rates
  • Korean bonds decline as BOK hikes, boosts inflation forecast
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Bonds fell across Asia with Japanese yields climbing to a six-year high following a report the central bank is debating how soon before it can signal rate hikes. Concern about gathering price pressures also weighed on government debt in Australia and South Korea.

Japan’s five-year yields advanced to the highest level since the central bank introduced its negative interest rate policy in January 2016 after Reuters reported policy makers may push up borrowing costs even before annual inflation reaches its target of 2%. That doesn’t mean a rate hike in imminent though the report said, citing people it did not identify.