The yield on the 10-year JGB crossed 1.5% for the first time since June 2009, while the 30-year bond yield breached the 2.5% mark for the first time since 2008. Nomura head of FX strategy for Japan Yujiro Goto told CNBC that the spike in yields is due to the sharp rise in EGB yields.

A surge in German borrowing costs prompted a selloff in fixed income markets across Asia, with Japan’s 10-year yield rising to 1.5% for the first time since June 2009. Yields in Australia and New Zealand also surged around 10 basis points.

Government bonds are coming under pressure globally, as Germany's move to cast off fiscal prudence to retool its economy and bolster its military ripples through markets. The bund rout continues: Fres