Bonds

Japan Leading the Way as World’s Most Volatile Bond Market

Japan Leading the Way as World’s Most Volatile Bond Market (CNBC)

For the most part, Japanese Prime Minister Shinzo Abe’s sweeping economic changes have been a boon to the moribund Japanese economy. To date, the plan has achieved modest success in devaluing the Japanese yen. The yen’s devaluation, in turn, is expected to generate an inflation rate of 2 percent and jumpstart the country’s export business. Unfortunately, Honest Abe’s plan has turned the world’s second-largest bond market into its most volatile one. In fact, since last Thursday, the yield on 10-year Japanese government bonds has ballooned by 26 basis points. And that trend is expected to continue as investors dump their bonds for stocks. Will you follow that lead, or steer clear of Japanese debt all together?

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