Market Information Tuesday 15 July 2025

Japan’s 10-year government bond yield jumped to 1.599%—its highest since 2008—as political uncertainty over fiscal discipline intensifies ahead of Sunday’s upper house election. With parties proposing consumption tax cuts and higher spending, investors fear further debt accumulation in a country already burdened with one of the highest public debt levels globally. Yields on 20- and 30-year bonds also hit multi-decade highs, prompting “bond vigilantes” to demand higher returns. Structural imbalances and reduced bond purchases by insurers and the BOJ add to the upward pressure on yields.

China’s economy grew 5.2% year-on-year in Q2, beating expectations and keeping the country on track for its 5% annual target. Strong industrial output (up 6.8%) supported the result, though retail sales growth slowed to 4.8% and real estate investment plunged by 11.2% in H1. Domestic consumption made up 52% of GDP, and unemployment held steady at 5%. The better-than-expected data may delay further stimulus, though structural issues—like soft inflation, weak fixed investment, and falling terms of trade—remain. Beijing may wait until September to launch additional fiscal support, particularly if trade negotiations with the U.S. falter before the August 12 deadline.

The U.S. is threatening to impose sweeping “secondary tariffs” of up to 100% on countries that continue buying Russian exports if Moscow doesn’t agree to end its invasion of Ukraine within 50 days. These tariffs, unlike traditional ones, would target third-party nations—such as China, India, and Turkey—that import Russian goods, especially oil. The move represents the most aggressive tariff threat to date and aims to exert geopolitical pressure through economic means. Despite the announcement, U.S. markets posted mild gains, with analysts watching upcoming inflation data closely to gauge whether existing tariffs are beginning to affect consumer prices.

The 6M Euribor is unchanged at 2.07% compared to previous business day. The 10Y Swap increased with 2 basis points to 2.70% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.