The Japanese regional bank with the best recent record for trading bonds has started buying Japanese government debt for the first time in a decade.
Iyogin Holdings started testing the $7 trillion market in April with small purchases of superlong bonds, marking the bank¡¯s first Japanese government bond (JGB) investment in 10 years, according its CEO Kenji Miyoshi.
The bank¡¯s move comes at a time when many insurers and foreign investors are avoiding JGBs, wary of yields rising due to Japan¡¯s fiscal policy and inflation. Miyoshi expects the Bank of Japan policy rate to rise to around 1.5% by the end of next year, adding there is also a possibility that the BOJ could accelerate the pace of tightening, including by implementing larger 50-basis-point increases rather than the usual 25-basis-point moves.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.