Rising interest rates, now near 30-year highs, are reshaping Japan's corporate bond market: higher funding costs for issuers have pushed investors back into fixed income, triggering fresh flows. Noriaki Nomura, head of debt capital markets at Mitsubishi UFJ, said that with Japan returning to an inflationary environment corporates are prioritizing capital expenditure to drive revenue growth rather than cutting costs. As of March, corporate bond issuance totaled a record JPY16.7 tln (about $1,030b

Rising interest rates, now near 30-year highs, are reshaping Japan's corporate bond market: higher funding costs for issuers have pushed investors back into fixed income, triggering fresh flows. Noriaki Nomura, head of debt capital markets at Mitsubishi UFJ, said that with Japan returning to an inflationary environment corporates are prioritizing capital expenditure to drive revenue growth rather than cutting costs. As of March, corporate bond issuance totaled a record JPY16.7 tln (about $1,030bn). Although brokers compile issuance differently, most expect fiscal-year issuance to be roughly flat with last year.