日债抛售潮愈演愈烈：10年期收益率创金融危机来新高，20年期拍卖需求疲软

Core Viewpoint - The Japanese bond market is experiencing a significant sell-off, with the 10-year government bond yield reaching its highest level since the 2008 financial crisis, driven by expectations of a large fiscal stimulus package from the new government led by Prime Minister Kishi [1][6]. Group 1: Bond Market Dynamics - The yield on Japan's 10-year government bonds rose by 2 basis points to 1.765%, marking the highest level since June 2008 [1]. - The 40-year government bond yield hit a record high of 3.695%, indicating increased selling pressure in the long-end of the bond market [1]. - The results of the 20-year bond auction showed weak investor demand, with the bid-to-cover ratio dropping from 3.56 to 3.28, reflecting a decline in investor interest [5]. Group 2: Fiscal Stimulus Expectations - Initial expectations for the supplementary budget were around 14 trillion yen, but indications suggest it could expand to 17 trillion yen, with proposals even reaching 25 trillion yen [6]. - The market is concerned that such a large spending plan will necessitate the issuance of more government bonds, leading to additional supply pressure [6]. - Analysts note that the government's dovish stance may require the issuance of longer-term bonds to finance the spending plan, raising concerns about fiscal sustainability [6]. Group 3: Market Sentiment and Global Impact - The widening "tail" in the auction results, from 0.13 to 0.31, is seen as a signal of weak demand, with the 20-year bond yield nearing its highest level since 1999 at 2.795% [5]. - The rapid rise in Japanese government bond yields could have spillover effects on global markets, as Japan's long-standing ultra-loose monetary policy has positioned its bonds as a benchmark in the global debt market [6]. - Concerns are growing that the risks associated with long-term bonds may spread to other markets, reminiscent of the bond market sell-off in May [7].