JGB Yields Hit 1996 Highs, Global Investors Circle Japan Bonds

Japanese government bond yields are touching levels not seen in three decades, and a growing number of global investors are starting to treat the asset class as something other than a dead zone.

The benchmark 10-year JGB yield hit 2.901% last Thursday, a level not reached since 1996. It has since eased to 2.781%, still up more than 70 basis points since January. The 20-year yield also touched 3.901% on the same day.

The move comes as the Bank of Japan continues to normalize policy after years of yield curve control, which had pinned the 10-year yield near zero. The BOJ abandoned YCC in March 2024. Now, with yields at multi-decade highs, some investors are starting to treat Japanese government bonds as a real asset class again.