What happened in Japan?! The 10-year Japanese government bond yield soared to 2.18%, the highest level in 25 years, reaching a new high since 1997!

Shift in the central bank (BOJ): The Bank of Japan has raised interest rates to 0.75% by the end of 2025 (ending decades of ultra-low interest rates). The market is currently betting that the central bank will have to continue raising rates to accommodate inflation and exchange rates.

Global assets are being drained (liquidity tightening): If Japanese institutions sell large amounts of U.S. Treasuries, U.S. Treasury yields will rise, increasing valuation pressures on U.S. stocks. This is equivalent to a "passive rate hike" on a global scale.
‍#收益率吸引力逆转： When the risk-free rate domestically in Japan can reach above 2%, for Japanese domestic institutions, after deducting currency hedging costs, buying Japanese government bonds may be more cost-effective and safer than buying U.S. Treasuries.