(Bloomberg) -- Japan’s era of negative interest rates will end in coming months, and the implications for world markets will be enormous, with US Treasuries ...
-- Japan’s era of negative interest rates will end in coming months, and the implications for world markets will be enormous, with US Treasuries set to suffer the most, according to the latest Bloomberg Markets Live Pulse survey.US Push for Release of Hostages Delays Israeli Ground War, But Won’t Stop It
“A shift in the BOJ’s policy could slow the export of capital from Japan as yields become more attractive locally than they were before,” said Martin Whetton, head of financial markets strategy at Westpac Banking Corp. in Sydney. Japanese investors are the biggest foreign holders of US government bonds, with more than $1.1 trillion at the end of August, according to data from the US Treasury Department. Life insurers dumped a net ¥196 billion of foreign bonds in the April-September period, following a record ¥8 trillion of sales in the previous six months, according to Ministry of Finance data.
Treasuries, traditionally the pillar of stability in many saving and investment portfolios, are already more volatile than stocks, at least by one measure. The combination of the aggressive policy tightening by the Federal Reserve and the flood of bond sales by the US government have imposed historical losses, especially on long-duration debt.
This yield gap has been widening, making the yen into worst performer among Group of 10 currencies so far this year. The Japanese currency has lost more than 12% against the greenback this year, ending last week at 149.86 per dollar. ‘I wouldn’t touch with anybody’s money’: Grant Cardone says these two major US cities are some of 'the worst markets to be in right now' for real estate investors — here's why