The Zhitong Finance App learned that as the market speculates that the Bank of Japan may raise interest rates again next month, Japanese corporate borrowers are issuing and selling bonds at a faster rate, striving to sell corporate bonds at a lower issuance cost before the Bank of Japan officially raises interest rates.

According to Daiwa Securities, one of Japan's largest underwriters, KDDI Corp., one of Japan's largest telecommunications companies, sold short-term corporate bonds worth up to 210 billion yen (about 1.4 billion US dollars) in four batches on Friday. Additionally, Daiwa Securities and traditional Japanese industrial giant Panasonic Corp. (Panasonic Corp.) were among the eight major bond issuers that chose to sell bonds in droves on Friday.

Prior to the Bank of Japan's next interest rate meeting from December 18 to 19, bond issuers apparently sped up their borrowing plans significantly. This morning, speculations that the Bank of Japan will choose to raise interest rates again in December can be described as intensifying. Earlier economic data showed that inflation in the Tokyo region was rising at an accelerated pace, while other economic indicators showed that Japan's economic growth and wage manufacturing data were generally in line with the Bank of Japan's predictions.

According to data released by Japan's Ministry of Internal Affairs and Communications on Friday, the Tokyo Core Consumer Price Index (CPI) rose 2.2% year on year in November, up from 1.8% the previous month. This result is higher than economists' forecast of 2%. Overall inflation rose to 2.6% due to rising food prices. The yen rose against the US dollar after the data was released. Tokyo's inflation data is generally regarded as a leading indicator of Japan's national inflation trend. Tokyo's data on Friday showed that Japan's inflation momentum still exists, which makes market participants continue to bet on the Bank of Japan's interest rate hike next month.

As Bank of Japan Governor Kazuo Ueda recently reiterated that if Japan's economic performance continues to be in line with the central bank's policy views, Japan's borrowing costs will continue to rise, and Japanese economic data supports the Bank of Japan's continued interest rate hike, the interest rate futures market's bet on the Bank of Japan's imminent interest rate hike roughly doubled this month.

According to statistics compiled by the agency, KDDI's bond issuance and sale was carried out after raising up to 300 billion yen in July, which brought the total issuance amount of the telecom giant to 510 billion yen in fiscal year 2024, setting a historical record for the company in a single fiscal year. According to an internal document, the company plans to use these latest funds raised to help the company acquire shares in Lawson Inc. and fund other sustainable large-scale projects.

If the Bank of Japan chooses to raise interest rates in December, interest rates will rise in the future, and future financing costs for companies will be higher. Therefore, in order to avoid paying higher interest in the future, many companies choose to issue bonds early to lock in financing costs in the current environment where interest rates are relatively low and the yield on benchmark treasury bonds is still low.