Japan to Raise Assumed Bond Interest Rate for Fiscal 2026

   Tokyo, Aug. 22 (Jiji Press)--Japan's Finance Ministry plans to raise its assumed interest rate on long-term government bonds to 2.6 pct for fiscal 2026 from 2 pct the previous year in light of rising bond yields, people familiar with the matter said Friday.
   The increase in the assumed interest rate is expected to push up the government's debt-servicing costs to around 30 trillion yen in the year that starts next April.
   The assumed rate is calculated by adding some 1.1 percentage points to prevailing rates to reflect the risk of a sharp increase in interest rates.
   Budget requests from other government agencies for fiscal 2026 are also expected to grow. As a result, overall general-account budget requests are expected to total around 120 trillion yen, hitting a record high for the third consecutive year.
   Japanese long-term interest rates have been rising since the Bank of Japan started normalizing monetary policy in 2024 after years of massive easing.

(2025/08/22-21:55)