Japan’s 10-year government bond yield climbed to around 3.1% on Thursday, returning to 30-year highs as strong economic data and hawkish signals from the Bank of Japan reinforced expectations for a faster pace of policy tightening. Central bank data showed manufacturing sentiment improved in the third quarter to its highest level in more than eight years, while overall business conditions reached their most favorable levels in decades. Meanwhile, a summary of opinions from the BOJ’s September meeting showed that policymakers saw a need to accelerate the pace of rate hikes or move them closer to the central bank’s target in the near term. Japanese bonds have also faced sustained selling pressure since the election of Prime Minister Sane Takaichi, amid ambitious spending plans and worsening fiscal conditions. Recent reports suggested that PM Takaichi would pledge a flexible response to unexpected market movements in a policy speech scheduled for next week.