The Japanese bond market has recently seen changes worth following. The yield on two-year government bonds has surpassed the 1% mark, a level not seen since 2008. Longer-term bonds are also on the rise - the five-year yield has reached 1.35%, while the ten-year yield has even touched 1.845%.

The market's reaction this time, to put it simply, is betting that the Bank of Japan will take action. The foreign exchange market also reacted, with the yen rising by 0.4% against the dollar, quoted around 155.49.

The Governor of the Bank of Japan, Kazuo Ueda, has recently made cautious statements, saying that he will carefully weigh the various impacts of interest rate hikes and will make a decision when the time is right. However, from the pricing in the bond market, it seems that traders are already preparing in advance for a policy shift. This kind of expectation difference often brings volatility.