Japan to Set FY26 Provisional Rate at 17-Year High, Yomiuri Says

Japan’s Finance Ministry plans to set the provisional rate for interest payments on government bonds at 2.6% for the next fiscal year, the highest level in 17 years, according to a local media report.

The accumulated interest rate, which serves as the basis for the initial calculation of debt-servicing expenses, will be set at 2.6% in the upcoming budget draft, the Yomiuri newspaper reported Friday. A year ago, the initially proposed rate for the current fiscal year was 2.1%. The ministry typically determines the rate by averaging recent market yields and then adding 1.1 percentage points to reflect historical fluctuations.