Japan's finance minister urges market stability amid bond sell-off

Japan's Finance Minister Satsuki Katayama has called for market stability as long-term government bond yields surge to multi-decade highs, Bloomberg reported. Katayama stated that Japan's debt dependency is at a 30-year low and its fiscal deficit is the smallest among G7 nations. She added that all options are on the table regarding the yen's weakness, based on consultations with the U.S. The rising yields, which move inversely to bond prices, indicate a strong sell-off in the Japanese government bond market. This trend is also pushing up U.S. Treasury yields, adding pressure to the global bond market. Analysts note that if Japanese bond yields continue to rise, it could force an unwinding of the yen carry trade, where investors borrow low-interest yen to invest in assets like Bitcoin or U.S. stocks. Such a move could create downward pressure on these markets as investors face pressure to repay their loans.