
JGB yields surge toward May highs on election-led fiscal concerns
Prices for long-dated debt continued their decline from last week, driving yields sharply higher, as prospects dimmed that Prime Minister Shigeru Ishiba's ruling coalition will retain its majority in the upper house after a vote on July 20.
A potential defeat could empower opposition parties that have pledged in their campaign platforms to cut or abolish the sales tax. Mounting fiscal concerns and soft demand at debt auctions triggered a surge in super-long yields to record levels in late May. In response, the Ministry of Finance curtailed its issuance super-long JGBs, starting with sales this month.
'Broadening of the ruling coalition would quite likely increase the probability of a reduction in the consumption tax rate,' Yusuke Matsuo, senior market economist for Mizuho Securities, wrote in a note to clients.
Japanese government bonds fall as 30-year auction tests demand
That in turn would put 'upward pressure on super-long interest rates in a climate where global fiscal risk has already been very much on the minds of bond market participants.'
The 10-year JGB yield rose 7 basis points (bps) to 1.57%, its highest since May 22. The 20-year yield rose 7 bps to 2.57%, closing in on the 2.6% level seen on May 23 that was the highest since October 2000.
The 30-year yield was up 7.5 basis points to 3.115%, nearing the all-time high of 3.185% hit on May 21.
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Business Recorder
a day ago
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Remittance incentive scheme to continue
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Express Tribune
a day ago
- Express Tribune
PM to continue remittance scheme for overseas Pakistanis amid record inflows
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Business Recorder
a day ago
- Business Recorder
Pakistan govt decides to continue remittance incentive scheme
Pakistan Prime Minister Shehbaz Sharif decided on Saturday to continue the remittance incentive scheme, directing the Ministry of Finance to immediately release funds on a priority basis for the Workers' Remittances Incentive Scheme, a statement from the Prime Minister's Office (PMO) read. The development comes a few weeks after State Bank of Pakistan's (SBP) Dr Inayat Hussain reportedly cautioned that the government's decision to curtail subsidies for promoting foreign remittances, which hit a record $38 billion in F2024-25, might reduce the flow through banking channels. 'Overseas Pakistanis are our strength and a valuable asset of the country,' PM Shehbaz was quoted as saying the PMO statement on Saturday. SBP revises Telegraphic Transfer charges scheme, raises limit to $200, includes ECs 'The hard-earned remittances sent by overseas Pakistanis play a vital role in Pakistan's development, and I, along with the entire nation, deeply value their contribution. 'These remittances not only helped in covering the rising import bill but also contributed to the increase in foreign exchange reserves,' he said. 'We are removing obstacles in the way of remittances sent by hardworking overseas Pakistanis and making the system more effective, efficient, and user-friendly.' The inflow of overseas workers' remittances into Pakistan stood at $38.3 billion in fiscal year 2024-25, the highest-ever in the country's history, the SBP data showed. Remittances increased by 27% year over year, compared to $30.25 billion recorded in the previous fiscal. Home remittances play a significant role in supporting the country's external account, stimulating Pakistan's economic activity as well as supplementing the disposable incomes of remittance-dependent households.