BOJ Now Owns Over Half of Japan’s $7.8T Debt Market
The Bank of Japan (BOJ) has quietly crossed a historic threshold—now officially holding 52% of all Japanese government bonds.
This means the central bank is now the primary backer of the nation’s $7.8 trillion debt, with $4.1 trillion of that sitting on the BOJ’s books, according to Bloomberg data.
By comparison, life insurers own just 13.4%, banks hold 9.8%, and pension funds carry only 8.9%. The numbers underscore how deeply Japan has come to rely on central bank intervention to prop up its bond market.
This reliance isn’t new. For years, the BOJ has aggressively purchased bonds under its yield curve control (YCC) policy to cap interest rates and stimulate inflation. But that strategy is now facing growing strain. Demand from traditional buyers has weakened, issuance costs are climbing, and the Japanese economy remains too fragile to absorb the growing burden.
Evidence of this stress is already showing in the market. Since April, the spread between 10-year and 30-year Japanese government bonds has surged by around 50 basis points—a more dramatic jump than seen in the U.S., U.K., or Germany.
Liquidity is evaporating, making it harder for investors to buy or sell without moving prices sharply.
Complicating matters further is the global landscape. President Donald Trump’s return to the White House has introduced new volatility, while Germany’s expansive new fiscal program is pushing up global yields, indirectly pressuring Japan’s already-stretched bond market.
With the BOJ increasingly boxed in, many are now wondering how long the central bank can keep the system running without triggering a full-scale bond crisis.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
