| • | Date: Monday, October 23, 2023 |
| • | Location: Held in Writing |
1. JGB Issuance Plan for the Supplementary Budget for FY2023 OPINIONS FROM THE PARTICIPANTS • It is important to firmly maintain the perspective of ensuring the fiscal sustainability in formulating JGB issuance plans hereafter, considering the possibility of the Bank of Japan’s monetary policy adjustments. • In terms of the relative room to increase the issuance amount in each maturity, it is possible to increase the issuance size of T-Bills, which have maintained negative yields, and 5-Year and 10-Year Bonds, for which we can clearly see buyers. • The bonds with relatively short maturities would have the potential to be additionally issued given the current situation where price fluctuations become larger over the expectation of BOJ's monetary policy adjustments. Specifically, T-Bills (6-month and 1-year) would be the best option. • The current demand for T-Bills is strong among both domestic and international investors. Therefore, even if the issuance amount of T-Bills is increased, there is no concern about the absorption of them. • Rising long-term interest rates is expected to drive depository financial institutions, which had preferred the ultra-long-term JGBs under the condition of low interest rates, to return to the medium- to long-term JGBs in the future and it is necessary to pay attention to a possible decline in overall demand for the ultra-long-term ones. • In our business category, there continues to be an appetite for ultra-long-term JGBs, especially 30-Year and 40-Year Bonds. |