Japan 2Y govt bond auction may have 99.96 lowest price: poll

Japan’s 2-year government bond auction is expected to see a bid-to-cover ratio near 2.0, with the lowest accepted price potentially reaching 99.96, according to a Bloomberg survey of primary dealers. This would indicate strong demand from investors, despite recent volatility in longer-dated bond yields. The 10-year government bond yield closed at 2.67% on June 30, 2026, reflecting a 0.03 percentage point increase from the previous session. The yield has risen 1.28 percentage points compared to this time last year, signaling a shift in market expectations for tighter monetary policy.

The Bank of Japan has maintained a hawkish stance, with Governor Kazuo Ueda reaffirming the central bank’s commitment to further rate hikes in line with economic and inflationary conditions. Board member Naoki Tamura has also supported the idea of incremental rate increases every few months. With the BOJ’s next policy decision scheduled for July 31, market participants remain attentive to potential shifts in monetary policy that could influence bond yields and auction outcomes.