Japan denies using its $1 trillion U.S. Treasury holdings as a bargaining chip in trade negotiations

ChainCatcher news, according to Reuters, Japan's Finance Minister Shunichi Suzuki denied in Milan the claim that Japan plans to use the sale of over $1 trillion in U.S. Treasury bonds as a threat in trade negotiations. Two days earlier, Suzuki hinted in a television interview that Japan might use its U.S. bond holdings as a bargaining chip, causing a brief disturbance in the global bond market.

Suzuki explained that his previous remarks were in response to questions about whether Japan could assure Washington that it would not easily sell off U.S. bonds, emphasizing that the main purpose of holding U.S. Treasury bonds is to provide the government with sufficient foreign exchange to stabilize the yen when necessary. Meanwhile, the Bank of Japan maintained the short-term interest rate at 0.5%, with Governor Kazuo Ueda stating that the timeline for achieving the 2% inflation target has been delayed due to the impact of new U.S. tariffs.