Japan bond delivery failures highest since global financial crisis

BOJ purchases squeeze liquidity even as outstanding balance tops $7.6tn

Throughout January, many investors speculated that the BOJ would move to shift away from its ultraloose monetary policy. © Reuters

AKIRA INUJIMA and YOHEI HIROSE, Nikkei staff writers

February 11, 2023 03:30 JST

TOKYO -- A growing number of sellers are failing to deliver promised Japanese government bonds to buyers as aggressive purchasing by the Bank of Japan dries up liquidity in the market.

Failures affected 5.08 trillion yen ($38.6 billion) of JGBs in 1,247 incidents this January, according to the BOJ -- the most since September 2008, when Lehman Brothers collapsed.