Japanese companies are selling superlong bonds amid expectations that Haruhiko Kuroda's reappointment as central bank governor will prolong easy monetary policy, even as increases in overseas yields put pressure on domestic market rates to rise.
Less than a week after Prime Minister Shinzo Abe nominated Kuroda for another term, Mitsubishi Chemical Holdings Corp. sold what was its first 20-year debt in about a year and a half on Wednesday. Next week, trading firm Toyota Tsusho Corp. plans to price 20-year notes, and Sumitomo Forestry Co. will sell its first 15-year securities ever, according to people familiar with the matter.
Kuroda's launch of the negative-interest-rate policy two years ago at the Bank of Japan sparked a rush by companies to sell longer bonds as borrowing costs tumbled and investors sought higher-yielding assets. Companies issued ¥1.68 trillion of bonds maturing in 15 years or more in 2017, the second-highest total after record sales a year earlier, according to compiled data. Concern that the yields of Japanese debt may be dragged higher in line with those of U.S. and European counterparts is also prompting issuers to sell longer bonds while rates are still low, according to Mizuho Securities Co.
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