Overview
- Japan’s 2-, 3-, and 5-year government bond yields set records as the 10-year climbed to about 2.39%, the highest since 1999.
- Market pricing now shows roughly a 55% chance that the Bank of Japan will raise rates by 0.25 percentage point this month.
- Analysts warn that a rate increase would raise yen borrowing costs and could force investors to unwind carry trades, leading to fast crypto selling.
- Reports of shipping disruptions in the Strait of Hormuz during the US–Iran conflict point to higher energy costs for Japan, which could keep inflation pressure elevated.
- After BOJ actions since 2024, Bitcoin often fell by about 20% to 35%, a pattern some analysts link to stress in yen-funded trades.