BoJ Still Controls Japan's Bond Market Despite Record JGB Reduction
The Bank of Japan's share of Japanese government bonds has fallen to about 46%, the lowest since 2021, but remains larger than all other major holder groups combined.
The Bank of Japan still holds roughly 46% of Japanese government bonds, an 8 percentage-point drop from its 2023 peak and its smallest share since 2021. Even after the decline, its JGB position is larger than the combined holdings of banks, life insurers, pension funds and foreign investors.
Over the 12 months through July, BoJ JGB holdings fell by about $310 billion, the largest 12-month decline on record. That reduced its total JGB stockpile to roughly $3.3 trillion, the lowest since 2020 but still more than 400% above 2012 levels.
For context, the BoJ owned only about 10% of JGBs in 2013. The figures highlight how the central bank is scaling back its balance-sheet footprint while remaining the dominant force in Japan's bond market.
Source: The Kobeissi Letter