USD/JPY Intermarket Analysis: US-Japan 10-yr yield spread hits 9-month low

Omkar Godbole FXStreet Contributor

USD/JPY's corrective bounce to 109.00 could be short-lived as the yield differential continues to slide in favor of the Japanese yen.

The spread between the 10-year US treasury yields and its Japanese counterpart fell to 268 basis points (bps) soon before press time - the lowest level since Apr. 2, 2018.

Moreover, the spread may continue to drop further, courtesy of dovish Fed expectations and extended risk aversion in the equities.

Yield spread

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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