Japan’s Fragile Debt Market Faces Two Auction Hurdles This Week

Japan’s bond market faces more challenges with debt sales on Tuesday and Thursday that may ramp up pressure on the government to adjust its borrowing plans and calm investor nerves.

Hot on the heels of auctions last month that exposed a lack of demand, the finance ministry will sell ¥2.6 trillion ($18 billion) of 10-year notes tomorrow and ¥800 billion of 30-year bonds two days later. The fragile sales sparked a rout in Japan’s bonds at a time when longer-maturity debt globally is under pressure from concerns about the ability of governments to cover massive budget deficits.