Long-term interest rates fall to 2.7% level, lowest level in three months; flee to safe assets as AI stocks fall

At the Tokyo bond market on the 23rd, the yield on newly issued 10-year government bonds, an indicator of long-term interest rates, fell (and the price rose), briefly reaching 2.755%. According to Nippon Mutual Securities, the stock price fell by 0.115% from the previous day, marking the lowest level in about three months since late July. As stocks continue to fall in Japan and the United States, especially stocks related to artificial intelligence (AI), there is a growing movement among investors to shift their funds to government bonds, which are safe assets.

As major IT companies operating data centers and cloud services known as "hyperscalers" continue to make huge investments in AI, there are growing concerns about whether they will be able to generate future profits. As a result, stocks are sold and bonds are bought, and long-term interest rates continue to decline. On the Tokyo stock market on the 23rd, the Nikkei Stock Average continued to fall, closing at 62,693.16 yen, 214.68 yen (0.34%) lower than the previous day's closing price.