The slump in Japanese bonds deepened Tuesday, sending yields soaring to records as investors gave a thumbs down to Prime Minister Sanae Takaichi¡¯s election pitch to cut taxes on food.
The 40-year rate hit 4%, the highest since its debut in 2007 and a first for any maturity of the nation¡¯s sovereign debt in more than three decades. The 20-year yield climbed 13.5 basis points after a lackluster auction underscored broader worries over rising government spending and inflation.
Since Takaichi took office in October, the 20-year yield has risen about 70 basis points while the 30- and 40-year rates have climbed almost 60 basis points. Investors are on guard for such moves spilling over into global markets amid the prospect of continued volatility in Tokyo trading ahead of the snap poll Takaichi is scheduling for Feb. 8.
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