From @johnauthers' Daily Note:
"Possibly the most important shift in the financial world is that China and Japan are changing places....
This year, with China’s imports to the US already declining under pressure from the Biden administration and far worse in prospect, and with the country still battling to find its way out from a huge overhang of debt taken out to finance its property, Chinese government bond yields have fallen. In Japan, however, it really begins to look like the deflationary psychology has been licked, and Japanese government bond yields have started to rise. Ten-year JGB yields were held at zero for years. They are now at 1.04%. Equivalent Chinese government bonds yielded 2.56% in January, but they have now dropped below 1.7%. Short Chinese bonds/long Japanese bonds would have yielded 20%."
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