Japan’s Bond Slump Highlights Policy Challenges, Strategists Say

A meltdown in Japanese sovereign bonds, with yields on 40-year debt surging past 4% for the first time on record, may pile pressure on the Bank of Japan to act quicker to raise rates, according to some analysts.

The government’s election pitch to cut taxes on food underscored broader worries over spending and inflation and brought into focus the risks to Japanese markets as the country unwinds years of super-easy monetary policy, they said.