Japan plans to reduce the issuance of ultra-long-term bonds starting in July.

According to Gate News bot, a report from Bloomberg reveals that a revised bond issuance plan draft shows that the Japanese Ministry of Finance is considering reducing the issuance of ultra-long-term bonds starting in July.

The draft plan released on Thursday shows that the Ministry of Finance proposed to reduce the issuance of 20-year, 30-year, and 40-year bonds in each auction by 100 billion yen (approximately 690 million USD) before the end of March 2026. To compensate for the reduction in issuance, the Ministry of Finance is considering increasing the issuance of 2-year bonds and other short-term bonds.

According to the proposed amendments to this fiscal year's plan, the issuance of 40-year bonds will be reduced by a total of 500 billion yen, to 2.5 trillion yen; the issuance of 30-year and 20-year bonds is expected to decrease by 900 billion yen respectively.

According to the proposed amendments, although the overall issuance will remain unchanged in principle, the total annual issuance in the market through auctions will slightly decrease from the current 172.3 trillion yen to 171.8 trillion yen.

The plan shows that the Treasury will submit the proposal to primary dealers at the meeting held on Friday. Due to market expectations that the Treasury will reduce the issuance scale of ultra-long-term bonds after significant fluctuations in yields, this meeting is receiving high attention from investors.

According to an informed source, the Treasury will also clarify its position on potential bond repurchases at the meeting, following reports that the Treasury is considering such measures.

The Ministry of Finance previously dismissed speculation that it might repurchase bonds as early as next month to alleviate demand concerns, stating that the idea is unrealistic.