Japan’s 10-year government bond yield held steady around 2.18% on Friday, near 27-year highs, as investors looked ahead to the Bank of Japan’s upcoming policy meeting for any signals on its rate-hike trajectory. The central bank is widely expected to maintain current policy next week, with markets pricing in the next rate increase around June. BOJ Governor Kazuo Ueda reiterated this week that the bank stands ready to raise rates if economic and price developments align with projections. Yields were also supported by speculation that Prime Minister Sanae Takaichi may call a snap election next month to advance more aggressive fiscal expansion, raising concerns over debt-funded spending. Takaichi is reportedly scheduled to provide further details on the dissolution of the lower house to ruling bloc officials on Jan. 19.
