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Posted on

February 26, 2026

Written by

Huw Roberts

1.UST rally – made in Japan?

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Japan is exporting lower yields to the US but Treasuries have now overshot macro fair value.

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The UST rally isn’t domestic; it’s imported from Japan.

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Qi’s custom ST model for 10y UST yields including 30y JGB yields has 73% confidence and shows JGBs as the second-largest positive driver. The ~50bp collapse in JGB yields has been instrumental in dragging Treasury yields lower.

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Fair value sits at 4.11% versus 4.24% on our core model. So the Japan influence is very real but, even so, spot has still overshot by ~7bp.

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