From 'Widow-Maker' to market shaker: Why Japan’s bonds are sending shockwaves globally

Japan currently finds itself stuck between a rock and a hard place. On the geopolitical front, Prime Minister Sanae Takaichi’s hawkish stance linking Taiwan’s security to Japan’s own has ruffled feathers in Beijing. China has already fired back with economic warnings—from freezing film approvals to squeezing seafood imports—signaling that Tokyo is in a delicate diplomatic bind. But the real storm is brewing at home. In a bid to soothe a public weary of inflation, the government is unleashing a massive stimulus package worth ¥21.3 trillion (roughly $135 billion). While the cash injection might help voters, it’s rattling a bond market that was already on edge. With the Bank of Japan (BoJ) stepping back and interest rates creeping up, bond yields are hitting levels not seen since the 2008