Further to the earlier reports that the International Monetary Fund on Tuesday released its weakest global growth expectations for the medium term in more than 30 years, the IMF has been reported to say that ´´should Japanese long-term rates rise further, Japanese investors' repatriation of funds could affect sovereign bond yields in Australia, several euro area countries and in the US.

The Washington, D.C.-based institution said earlier that five years from now, global growth is expected to be around 3% — the lowest medium-term forecast in an IMF World Economic Outlook report since 1990. 

In Asia, the IMF is commenting that allowing more flexibility in YCC could have some repercussions for global markets although it could also help prevent abrupt policy changes later that could trigger large spillovers.