Title: Japanese Government Bond (JGB) Definition
Headings: Japanese Government Bond (JGB)
Japanese Government Bond (JGB)
What Is a Japanese Government Bonds (JGB)?
Understanding Japanese Government Bonds (JGBs)
Special Considerations
Japanese Government Bonds (JGBs) vs. U.S. Treasuries

Content: Understanding Japanese Government Bonds (JGBs)
Japanese government bonds (JGBs) have various maturities ranging from 6 months to 40 years. Its short-term bonds with maturity dates of one year or less are issued at a discount to par and are structured as zero-coupon bonds. However, at maturity, the value of the bond can be redeemed at its full face value. Its medium- to long-term bonds have fixed coupon payments, which are determined at the time of issuance and are paid on a semi-annual basis until the security matures. There are three kinds of Japanese government bonds (JGBs): General bonds, such as construction bonds and debt financing bonds. Fiscal Investment and Loan Program (FILP) bonds, which can be used to raise funds for the investment of the Fiscal Loan Fund. Subsidy bonds. Special Considerations
A decline in liquidity in the JGB market has been observed in recent years due to the aggressive monetary actions of the central bank—The Bank of Japan (BoJ). Since 2013, the Bank of Japan has been buying up billions of dollars of Japanese government bonds, flooding the economy with cash in an effort to propel the country’s low annual inflation rate toward its 2% target by keeping long-term interest rates at around 0%.