Two Japan Bond Auctions Pose Next Threat to US Treasury Yields
The US and Japanese bond markets have become increasingly intertwined in recent years as investors grapple with rising government debt and greater volatility.
Source: Mises Institute
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DW NOTE
Japan holds ¥1.08 trillion in Treasuries — more than any sovereign except China. When Tokyo auctions its own debt, it pulls yen liquidity that might otherwise flow into dollar bonds. The article treats this as a transmission mechanism worth monitoring, but the real question is simpler: how long can the Fed maintain 4.74% 10-year yields while funding an $1.8 trillion deficit if foreign central banks are net sellers? The answer is becoming empirical rather than theoretical.