Japan is gearing up to reduce its issuance of super-long bonds, a move that could have a significant impact on the market. With the government looking to stabilize a market facing escalating yields, there is a potential shift towards shorter maturities and fewer longer-dated debt sales. This adjustment aims to mitigate the risk of substantial capital losses associated with the longest bonds and could lead to a more sustainable market environment.
Despite reducing supply, Japan’s longest bonds still face significant risks
