Suga’s fiscal stimulus and December MoF fiscal flow projections hint at fiscal year 2021 JGB issuance: The MUFG Global Markets Podcast

The autumn Diet session ended on December 5. A risk of increased JGB issuances is lurking amidst the government ruling coalition’s announcement of a 15-month budget in mid-December and the Ministry of Finance’s release of its FY21 JGB issuance plans later in the month. Ahead of this, spot Dollar / Yen and Dollar / Yen cross-currency basis have been fairly flat and the Nikkei Average has stabilized around 26,000. The coronavirus crisis roiled markets in 2020, but markets in Tokyo are closing the year calmly.

In today’s episode, MUFG Chief Japan Strategist, Takahiro Sekido, previews economic stimulus, reviews the Bank of Japan’s monetary operations in November, discusses fiscal fund supply and demand in December, and examines recent investor cross-border flows. He also offers his outlook for Yen rate, Dollar / Yen cross-currency basis, and spot Dollar / Yen.