Japanese government bond yields are climbing as persistent inflation and fiscal concerns weigh on investors. A new government growth strategy, aiming for substantial public and private investment, is fueling worries about further inflationary pressures and potential interest rate hikes. Despite recent inflation data remaining below target, markets anticipate the Bank of Japan's continued policy normalization, driven by elevated energy costs and a weak yen.

Japanese government bond yields are climbing as persistent inflation and fiscal concerns weigh on investors. A new government growth strategy, aiming for substantial public and…

Japan's 2-year bond yield hit 1.41% and the 5-year reached 1.915% as the BOJ reduces stimulus. Here's what rising Japanese yields mean for global markets.