Japan JPY

Japan 5 Year Note Yield

Impact:
Low

Latest Release:

Date:
Actual:
0.04%
Forecast:
Previous/Revision:
-0.007%
Period:
What Does It Measure?
The Japan 5 Year Note Yield measures the return on investment for a bond issued by the Japanese government with a maturity of five years. It primarily assesses the market's expectations of interest rates, inflation, and economic growth, serving as a key indicator of overall financial sentiment, government creditworthiness, and investor behavior in Japan.
Frequency
The Japan 5 Year Note Yield is updated daily, reflecting the latest transactions and market sentiment regarding the bond, and does not involve preliminary or final reports.
Why Do Traders Care?
Traders closely monitor the Japan 5 Year Note Yield because it serves as a benchmark for interest rates and influences the pricing of various other assets, including currencies like the JPY, equities, and other fixed-income securities. Changes in the yield can signal shifts in monetary policy expectations, affecting financial market forecasts and risk appetite.
What Is It Derived From?
This yield is derived from the prices of recently issued 5-Year Japanese Government Bonds (JGBs) and reflects the yield investors demand for holding these securities. It is calculated based on the prevailing market prices, taking into account the bond's face value, coupon rate, and time to maturity.
Description
The Japan 5 Year Note Yield encapsulates the market's expectations concerning the future trajectory of interest rates and can impact various financial instruments beyond government bonds. It is often influenced by macroeconomic indicators, central bank policy announcements, and global economic conditions, making it a vital barometer for market sentiment in Japan.
Additional Notes
This yield acts as a leading economic measure, as changes in bond yields typically precede shifts in economic activity and monetary policy. Comparatively, it is essential to consider how the yield on 5-Year JGBs relates to yields on similar bonds in other economies, which can provide insights into investor risk perception and capital flows.
Bullish or Bearish for Currency and Stocks
A rise in the Japan 5 Year Note Yield, indicating higher than expected returns, is usually bearish for the JPY and bullish for stocks due to increased investor confidence in economic growth leading to potential equity market gains. Conversely, if the yield decreases below expectations, it can be viewed as bullish for the JPY and bearish for stocks, as it may signal lower growth or inflation concerns, thereby reducing returns on investments.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number Better than forecast for the currency (or previous revise better)
Red Number Worse than forecast for the currency (or previous revise better)
Hawkish Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish Favors lower rates to boost growth, weakening the currency but lifting stocks.
Date Time Actual Forecast Previous Surprise
Sep 13, 2022
0.04%
-0.007%