Japan is considering an 8 trillion yen ($82 billion) target for budget-deficit cuts over the next two years as officials debate how to proceed with a sales-tax increase that threatens to damage an economic rebound.
Japan’s 20-year bond yields may drop to levels unseen since the collapse of Lehman Brothers Holdings Inc. in September 2008 as the Federal Reserve keeps interest rates near zero, Royal Bank of Scotland Group Plc. said.
Japanese bond futures traded near a two-year high after reports showed the nation’s retail sales grew at the slowest pace since January and the U.S. economy expanded at a lower rate than previously estimated.
Haruhiko Kuroda was endorsed by the lower house of parliament to become Bank of Japan governor, clearing the first hurdle in Prime Minister Shinzo Abe’s plan to install a central bank leadership in favor of more easing.