TOKYO: Japanese government bond (JGB) yields struggled for direction on Monday, as the market sized up Joe Biden’s withdrawal from the US presidential race and weighed the chance of a rate hike at the Bank of Japan’s (BOJ) July monetary policy meeting.

The 10-year JGB yield was last up 0.5 basis point (bp) at 1.045%, after sliding to 1.035% as it tracked a dip in US Treasury yields on the news that Biden had abandoned his reelection bid.

US Treasury yields had risen last week in part on growing bets that Republican nominee Donald Trump would win in November, although market views may become more divided now, said Katsutoshi Inadome, senior strategist at Sumitomo Mitsui Trust Asset Management.

“I suspect we’ll go back to a fifty-fifty split once again.” Benchmark 10-year JGB futures fell 0.04 yen to 143 yen.

The two-year JGB yield was flat at 0.34%, and the five-year yield ticked down 0.5 bps to 0.585%.

Speculation continued over the chance of a rate hike at the BOJ’s July 30-31 meeting, although rate hike bets lessened a little amid a lack of media reports over the weekend supporting that possibility, said Inadome.

“If it follows the usual pattern, we’d start to see some reports about now.”

Japan’s 2 year bond yield hits 13-year high as BOJ chief hints chance of another rate hike

More than three-quarters of economists polled by Reuters said the BOJ will skip another rate hike this month as it looks to shore up tepid economic growth.

Questions also remain regarding the pace and scale of JGB purchase cuts that the bank will announce this month.

The BOJ received a sizeable number of requests to halve monthly bond buying in coming years, albeit at a gradual pace, minutes of a meeting between the bank and financial institutions showed on Friday.

The 20-year JGB yield rose 2 bps to 1.85%.

The 30-year JGB yield climbed 3.5 bps to 2.17%.