Japan to consider mid-year review of bond sales plan, MOF official says

By Leika Kihara

TOKYO, Nov 27 (Reuters) - Japan's Ministry of Finance (MOF) will consider conducting a mid-year review of its annual bond issuance plan given strong support for the idea in a meeting with bond market participants, a senior ministry official said on Thursday.

Almost all the participants in the meeting with the MOF favoured the idea, proposed by Mitsubishi UFJ Morgan Stanley Securities, as helping increase the predictability of its bond issuance plan, the official said in a briefing.

While details have yet to be worked out, the ministry will consider moving ahead with the idea with an eye to holding such a mid-year review around June of each year.

The ministry compiles in December an annual bond issuance plan for the following fiscal year, but currently does not conduct reviews on a regular basis.

A sell-off in super-long Japanese government bonds (JGB) forced the MOF to slash sales of those notes in a rare revamp in June of its bond issuance plan for the current fiscal year.

The MOF is set to tweak the bond issuance plan again on Friday to fund Prime Minister Sanae Takaichi's big spending package. Fears of a debt oversupply have led to renewed falls in JGB prices and the yen.

As for next fiscal year's bond issuance plan, participants in Thursday's meeting generally preferred slashing sales of super-long JGBs, particularly for 30-year notes, the official said.

They instead saw scope for the MOF to increase issuance of two, five and 10-year JGBs.