JGB yields hit fresh multi-year highs as wages rise
TOKYO, Feb 5 (Reuters) - Japanese government bond (JGB) yields hit new multi-year highs in early trade on Wednesday after government data showed a rise in wages, bolstering chances of further interest rate hikes.
The 10-year JGB yield JP10YTN=JBTC rose 2 basis points (bps) to 1.295%, its highest since April 2011.
The two-year JGB yield JP2YTN=JBTC, sensitive to the Bank of Japan's monetary policy, rose 2 bps to 0.76%, its highest since October 2008.
Japan's December inflation-adjusted real wages rose 0.6% year-on-year thanks to a wintertime bonus bump, preliminary government data showed, with government officials expressing optimism that wage hike momentum ahead is growing.
Wage increases are seen as a key factor for the BOJ to raise interest rates further. The market is divided about how far the BOJ policy rate will rise, making it hard for investors to buy JGBs, strategists said.
The five-year yield JP5YTN=JBTC rose 2.5 bps to 0.95%, its highest since November 2008.
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