Bond market long-term interest rate is low for the first time in three years

Bond market Long-term interest rate is low for the first time in three years

With the growing sense of caution about the future of the global economy, the movement of buying Japanese government bonds, which are considered to be relatively safe assets, spread in the bond market on the 16th, and the long-term interest rate is minus 0.255% for the first time in three years. It is a low level.

Against the backdrop of the US-China trade friction, the financial markets are becoming more cautious about the future of the global economy, and stock prices are also being lowered globally.

Under these circumstances, the bond market on the 16th has seen a rise in prices due to widespread movement to buy Japanese government bonds, which are considered relatively safe assets.

Government bonds are in a relationship of lowering yields as prices rise. Above all, the yield on 10-year government bonds, which is a typical indicator of long-term interest rates, temporarily declined to minus 0.255%.

This is the lowest level in three years since July 2016.

Market officials said, “In response to the economic slowdown, the observation that the European Central Bank will make further monetary easing next month has spread, and the movement to buy government bonds has spread in the US and Europe. "

On the other hand, the BOJ is buying large amounts of government bonds to induce low long-term interest rates as part of a large monetary easing policy.

On the 16th, however, the amount of government bonds purchased has been reduced more than before, and the market is accepting that it may be aimed at further reducing the level of long-term interest rates.