Japan companies go for short-term commercial paper on BOJ hike concerns

Longer-term debt faces undersubscriptions and cancellations

20241126 boj CP issuance

A survey by QUICK found that as of Nov. 22, around 60% of respondents predict a December rate hike by the BOJ, with nearly 90% expecting a rise by January. (Photo by Nanami Sato)

ORI TSUJI and YUKI OKOSHI, Nikkei staff writers

TOKYO -- Companies in Japan are reducing the maturity periods of their commercial paper, short-term debt instruments that they use to manage immediate financing needs.

Market expectations that the Bank of Japan may raise interest rates at its December policy meeting have led to concerns about rising rates for commercial paper, reducing demand for the longer-term variety. This has forced companies to focus on short-term issues of the debt.

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