The risks of surging Japanese bond yields

1. Rising government fiscal pressure: An increase in government bond yields means higher borrowing costs, which could long-term squeeze fiscal space.

2. Financial institutions under pressure: Banks and insurance companies hold a large amount of government bonds, and a decline in bond prices will affect their balance sheets.

3. Policy dilemma: If the Bank of Japan does not intervene, interest rates will continue to rise; if it intervenes, market confidence may be further shaken.

4. Spillover risks: Japan is one of the global sources of capital, and if it is forced to withdraw funds, it could impact global markets.