Major Japanese life insurers have indicated plans to maintain or increase their purchases of domestic bonds, a move that is likely to support JGB auctions in the second quarter. Japan Post Insurance plans to increase purchases of yen-denominated bonds, Daido Life plans to increase its holdings of domestic bonds, and Meiji Yasuda is expected to maintain its holdings of government bonds at roughly current levels while switching into higher-yielding bonds.
Major Japanese life insurers have announced plans to maintain or increase their purchases of domestic bonds, raising the prospect of stable demand for government bonds. Japan Post Insurance has indicated its intention to increase purchases of yen-denominated bonds, which is expected to boost its overall holdings of domestic bonds.
Daido Life has disclosed plans to increase its holdings of domestic bonds and is expected to expand its holdings mainly through corporate bonds. This is likely to underpin demand for private-sector bonds and could contribute to the stability of future government bond auctions.
Meanwhile, Meiji Yasuda Life has indicated a policy of broadly maintaining its current holdings of government bonds while continuing to switch assets from low-yielding bonds into higher-yielding bonds. These developments have prompted expectations that Japan's life insurance sector could help reactivate demand in the long-term government bond market.