Japanese bonds fell the most in three months and Australian government securities slid for an eighth day in the latest leg of a global rout in debt markets.
With the Federal Reserve poised to raise interest rates, the U.S. 10-year yield climbed to a two-month high of 2.26 percent Wednesday. Investors in Germany and Japan are balking at yields that are at least 160 basis points less than what they can get in the U.S.
“There’s a perception that the bull run in fixed income is coming to a close,” said John Gorman, the head of dollar interest-rate trading for Asia and the Pacific at Nomura Holdings Inc. in Tokyo. Investors “think that the raising of rates is coming.” The company is one of the 22 primary dealers that trade directly with the Fed.