Japan's financial market will see a huge flow of funds in fiscal 2000 because 27 trillion yen is expected to be transferred from postal savings to other financial instruments, according to an estimate by the Posts and Telecommunications Ministry.
The estimate, released Wednesday, put upward pressure on long-term interest rates, triggering fears that the government may be forced to sell bond holdings to meet expected withdrawals by depositors.
At one point in interdealer trading Thursday morning, the yield on the No. 215 10-year, 1.9 percent government bond climbed to a six-month high of 2.04 percent, although it declined below 2 percent later on. Some market watchers said the posts ministry's estimate was within the range of expectations.