Japan’s 5-Year Yield Hits 19-Year High: The End of Zero-Interest
The era of "free money" in Japan is officially over. The 5-year JGB yield has surged to ~1.60%, its highest level since 2007, signaling a massive structural shift in the global financial landscape.
Why it’s moving:
BoJ Rate Hikes: The Bank of Japan is aggressively normalizing policy to combat a weak Yen and persistent inflation.
Fiscal Pressure: A new ¥21 trillion stimulus package is flooding the market with new debt.
Global Repatriation: Japanese investors are pulling cash out of foreign markets to take advantage of rising yields at home.
As Japan exits its decades-long hibernation, the "Carry Trade" is collapsing, raising borrowing costs globally and forcing a total rethink of yen-funded investment strategies.
