BoJ Rate-Hike Signal Pushes US 10-Year Treasury Yield to 4.086%, as Japanese Investors Repatriate USD to Buy Domestic Bonds

COINOTAG News, December 2 — In response to a Bank of Japan policy signal, the 10-year US Treasury yield advanced to 4.086%, rebounding by roughly 3.12% from a recent low of 3.962%, signaling policy-driven volatility in core fixed income.

With Japanese investors, historically the largest foreign holders of US Treasuries, a BoJ policy shift can reprice cross-border demand. If rising JGB yields reinforce domestic borrowing incentives, capital could flow back to Japan, reducing demand for US bonds and nudging bond prices lower, thereby lifting yields and widening global USD borrowing costs.

Markets will continue to monitor the interplay between BoJ policy signals, US Treasury dynamics, and risk assets. The near-term trajectory for treasury yields will hinge on pricing in further monetary policy developments and the pace of yen funding flows as investors reassess cross-border risk premia.