Informed sources: The Bank of Japan may slightly reduce its purchases of ultra-long-term Japanese government bonds in Q4.

Jin10 data reported on September 9th that three informed sources revealed that despite a recent rise in ultra-long-term Japanese government bond yields, the Bank of Japan may still slightly reduce its purchases of such bonds in the fourth quarter. Such measures would align with market expectations and be consistent with the Bank of Japan's guidance — namely, prioritizing the reduction of the bond-buying scale for maturity types with a higher proportion of their Holdings to total issuance. They indicated that the Bank of Japan will make a final decision on September 30th, which may be influenced by the results of the 20-year government bond auction on September 17th and the degree of fluctuation in ultra-long-term Japanese government bond yields. If the Bank of Japan indeed reduces its purchases of ultra-long-term government bonds at that time, it would mark the second adjustment since the reduction in the second quarter.