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Benchmark Japanese bond yields rise towards 29-year high ahead of BOJ

BY Reuters | ECONOMIC | 08:32 PM EDT

By Rocky Swift

TOKYO, April 28 (Reuters) - Yields on benchmark Japanese government bonds edged towards a 29-year high on Tuesday as investors awaited a policy decision from the central bank and signals for future rate hikes.

The benchmark 10-year JGB yield rose 0.5 basis point (bp) to 2.475% in early trading, closing in on the 2.49% level hit earlier this month that was the highest since June 1997. Yields move inversely to bond prices.

At the conclusion of its two-day policy meeting on Tuesday, the Bank of Japan is widely expected to keep its key rate at 0.75%. That puts the focus on the central bank's quarterly outlook report and comments from Governor Kazuo Ueda for signs of how the Middle East conflict may impact the rate-hike path. (Reporting by Rocky Swift in Tokyo; Editing by Subhranshu Sahu)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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