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2024

2023

  • Public Finance Watch

    Public Finance Watch

    10 January 2024 329 KB PDF
    • Noto earthquake to increase contingency reserve funds in FY24 budget bill, but no impact on calendar-based market issuance of JGBs
    • FY24 budget bill’s general contingency reserve fund increased to support areas hit by Noto Peninsula earthquake; new JGB issuance also increased
    • JGB issuance plan to be revised at same time, but calendar-based market issuance likely unchanged owing to use of front-loading issuance of refunding bonds
  • Daiwa's View

    Daiwa's View

    5 January 2024 521 KB PDF
    • Analysis of JGB term premiums
    • Expect increased interest in JGB term premiums if Japan transitions to “world with interest rates”
    • 10yr JGB yield rise above 0.9% last year linked to sharp UST term premium rise, but currently unsustainable
    • Immediate target is pre-QQE “0.5% risk-neutral yield + 0.5% term premium ≈ 1%”; see 0.4% + 0.4% ≈ 0.8% as realistic target for a dip-buying
  • Public Finance Watch

    Public Finance Watch

    4 January 2024 530 KB PDF
    • FY24 JGB issuance plan, draft budget, timing for issuing CT bonds
    • MOF plans to issue Y1.7tn in CT bonds with decisions on maturities/issuance timing expected around Mar; likely options are one issuance (Apr-Jun) or two (Apr-Jun + from Jul)
    • Calendar-based JGB market issuance plan cut by almost Y20tn; flowbased avg maturity has lengthened to about same level as before coronavirus
    • Draft budget supports public sector wage hikes; goal of returning spending to normal remains difficult due to many issues other than coronavirus; breaking from 30 years of deflation seen as essential