The Japan premium has continued to be nearly zero for short-term transactions, but a small premium has been observed for transactions maturing beyond the year-end. Yields on long-term government bonds declined from late August to the level of around 1.6 percent. They rose somewhat thereafter and have recently been moving between 1.7 and 1.8 percent.
Conclusion As investors, you are trying to make sense of the global economy and the implications for investment opportunities and risks, stripping out the signal from the noise. Using a simple framework with trade, financial, and uncertainty channels helps us try and make sense of a complicated world, and the policy implications for New Zealand. I hope these insights prove useful.