Japan prime minister Ishiba says government is taking issue of rising prices seriously

• Government making utmost efforts to overcome rising prices
• Cannot agree on call to reduce consumption tax rate
• It will take a long time to adjust system for lower consumption tax rate on food
• It is not true that government is mulling providing cash handouts
• Sharp rises in JGB yields have undesirable impact on economy, fiscal situation (Akazawa)
• Government’s stance is to promote increase in domestic investors for JGBs (Akazawa)
• If interest rates rise sharply, that could increase Japan’s debt financing costs (Akazawa)

I guess that kills off the report from earlier this week here. The other remarks are nothing major but it paints the picture that amid the surge in long-end JGB yields, the government’s fiscal situation is under heavy scrutiny. And that puts the BOJ in a bit of a tough spot to raise rates further again.

This article was written by Justin Low at www.forexlive.com.