Rates on Japanese government debt surged across the curve on September 25, pushing the 10 year security to 3.115% and the 40 year maturity to 4.255%. This movement followed a jump in U.S. Treasury yields that triggered broader selling of Japanese government bonds. Other benchmarks also climbed, with the 2 year, 5 year, and 20 year yields reaching 1.920%, 2.400%, and 3.955% respectively.

The yield on 30 year bonds reached a record high of 4.210%, while the 10 year rate hit its highest level since September 1996 earlier in the week. Some investors have begun repatriating overseas assets as yields rise, although the Finance Ministry is considering cutting the issuance of medium term bonds in liquidity enhancement auctions. Further capital returns remain limited by uncertainty regarding the Bank of Japan's interest rate trajectory and where yields will peak.