Japan Rates Insights

Research evidence excerpt

Japan Rates Insights

Global Markets Research

23 July 2026Japan Rates Insights

Rates - Global

Research AnalystsAssessing the impact of including government

Japan Rates Strategybonds in NISA

Ryosuke Matsuzaki - NSC

Inclusion of retail JGBs to NISA could drive JPY3.8trn inflows, and lower ryosuke.matsuzaki@nomura.com

USD/JPY by two big figures through substitution from foreign equities. +81 3 6703 3871

Masaki Kuwahara - NSC

• Background: Discussions on including retail government bonds in NISA are masaki.kuwahara@nomura.com

intensifying, and proposals that also incorporate inheritance tax relief are being +81 3 6703 3876

considered. While the details of the institutional design remain unclear, such

Global FX Strategy measures could significantly alter household money flows.

Yusuke Miyairi, CFA - NIplc

• Rates implication: According to our estimates, capital inflows of approximately yusuke.miyairi@nomura.com

JPY3.8trn are expected into retail government bonds. However, the amount of inflows +44 (0) 20 7102 4145

could vary substantially, depending on the yield on retail government bonds and the Yujiro Goto - NSC

eventual design of the NISA framework. yujiro.goto@nomura.com

+81 3 6703 1120

• FX implication: NISA substitution from foreign equities to retail JGBs could ease JPY

depreciation pressure by ~JPY2trn, based on our estimates, lowering USD/JPY by

roughly two big figures and partially offsetting the recent trade and services deficit.

Fig. 1: Additional inflows into retail government bonds (JPY tn) Fig. 2: FX impact of the inclusion of retail JGBs to NISA via

substitution effects

Interest rates of retail government bond

0.50% 1.00% 1.50% 2.00% 2.50% 3.00% Retail JGB substitution ratio by 40s and over

20s 0.06 0.11 0.16 0.22 0.27 0.32 JPY trn