Japan retracts "US debt will become a bargaining chip against the United States" argument

On May 5th, Japan has reversed its attitude towards the use of US Treasury bonds as a negotiating tool with the United States. According to a Nikkei coverage, Japanese Finance Minister Katsunobu Kato said on Sunday (May 4) that Japan has no intention of using the possibility of selling its holdings of US Treasury bonds to gain an advantage in trade negotiations with the United States. Japan does not believe that selling US Treasury bonds is a tool for Japan-US negotiations. Kato said on Friday that although Japan will not sell its holdings of US Treasury bonds easily, they are a "card" in negotiations with the United States on trade issues; and at a press conference on Sunday he refuted this statement. Japan's Finance Ministry reported that as of the end of March, Japan held $1.27 trillion in foreign exchange reserves, most of which were US Treasury bonds. Foreign exchange reserves can be used to intervene in the foreign exchange market. In April, Mr. Kato ruled out using Japan's holdings of US Treasuries as a negotiating tool.