The Japanese government plans to more actively reduce the scale of ultra-long-term government bond auctions.

Golden Ten Data on June 20, a document released by the Japanese Ministry of Finance showed that the government plans to reduce the auction scale of ultra-long-term bonds more significantly in this fiscal year than originally planned. In the revised plan, the Japanese government will reduce the bidding amount of 20-year government bonds by 1.8 trillion yen (about 12.38 billion U.S. dollars) to 10.2 trillion yen by the end of March next year, the bidding amount of 30-year government bonds will be reduced by 900 billion yen, and the bidding amount of 40-year government bonds will be reduced by 500 billion yen. This means that starting next month, the size of the 20-year government bond auction will be reduced by 200 billion yen per auction, which is higher than the 100 billion yen shown in the draft document seen by some institutions on Thursday. The revised issuance plan was presented to the primary dealers for discussion at Friday’s meeting. The total amount of JGB auctions for the year ending March next year will be reduced by 500 billion yen to 171.8 trillion yen. The decrease in ultra-long-term bonds will be partially offset by an increase in short-term bonds. Revisions to the annual auction plan and the Bank of Japan’s decision this week to slow the pace of tapering from next fiscal year reflect policymakers doing their best to reassure market concerns after ultra-long-term bond yields surged to record highs last month.