Intriguing RV graph: What has JGB market factored in since Upper House election?
Key points
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Changes for JGB yield curve, ASW spread since Upper House election suggest stronger BoJ rate hike speculation, easing fiscal concerns
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Growing speculation about rate hikes directly influenced by US/Japan tariff agreement, BoJ-related news, but undercurrent of rising inflation expectations
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Fiscal concerns easing somewhat but not dispelled; 10s30s JGB spread and super-long ASW spreads remain elevated; liquidity concerns persist
