Key Facts
• July 16: Bond market expected to decline following U.S. CPI data.
• U.S. CPI led to fading rate cut expectations and rising long-term yields.
• Mitsui Sumitomo strategist Katsutoshi Inadome highlights fiscal deterioration concerns post-election.
• 10-year Japanese government bond yield forecast: 1.59%-1.61% (July 15: 1.585%).
• September bond futures range: ¥137.60-¥137.90 (July 15 close: ¥137.92).
• U.S. 10-year Treasury yield closed at 4.48%, up 5 basis points on July 15.
• Night trading for September futures ended at ¥137.78, down ¥0.14 from day trading close.
Summary
The bond market is projected to decline on July 16, influenced by rising U.S. long-term yields and fading rate cut expectations following the release of the Consumer Price Index (CPI). Mitsui Sumitomo Trust Asset Management strategist Katsutoshi Inadome noted that fiscal deterioration concerns, including potential tax cuts post-election, are being factored into the market. The 10-year Japanese government bond yield is forecasted to range between 1.59% and 1.61%, while September bond futures are expected to trade between ¥137.60 and ¥137.90. On July 15, U.S. 10-year Treasury yields rose by 5 basis points to 4.48%, and September futures closed at ¥137.78 in night trading, down ¥0.14 from the day session. The market remains cautious amid these developments.
