Key trading data: The yield on the US 10-year Treasury bond rose to 4.086%

On December 2nd, according to market information, influenced by the interest rate hike signal issued by the Bank of Japan, the yield on the US 10-year Treasury rose to 4.086%, rebounding approximately 3.12% from a recent low of 3.962%. Japanese investors are the largest foreign holders of US Treasuries. The market view generally holds that when the Bank of Japan raises interest rates, the yields on domestic Japanese bonds (JGB) begin to rise (for example, the 10-year Japanese government bond yield breaks the 1% threshold), Japanese funds will no longer need to endure exchange rate fluctuations to purchase US Treasuries but will instead choose to sell US Treasuries, with funds flowing back to Japan to purchase domestic bonds. The decline in US Treasury prices will lead to an increase in US Treasury yields, raising the global dollar borrowing costs and thereby creating Unfavourable Information for risk assets. The recent rise in the yield on the US 10-year Treasury indicates that the market has reacted to the interest rate hike signal from the Bank of Japan.