Finance Minister: All Cards Should Be on Table in Tariff Negotitations; Japan Largest Foreign Holder of U.S. Bonds

The Yomiuri Shimbun

13:12 JST, May 3, 2025

Finance Minister Katsunobu Kato said that Japan should conduct tariff negotiations with the United States with all potential cards on the table, during a TV Tokyo program that aired on Friday.

During the program, Kato was asked about the possibility of Japan intentionally signaling its reluctance to easily sell its holdings of U.S. Treasury bonds during negotiations. According to the U.S. Treasury Department, as of February Japan holds about $1.13 trillion (¥163 trillion) in U.S. Treasury securities, accounting for 13% of the total, making it the largest foreign holder.

“It is only natural that we hold talks with all potential cards on the table,” he said in response. He also emphasized that Japan is an important U.S. partner for such reasons as its large holdings of U.S. Treasury bonds.

Kato’s remarks were made against the backdrop of the United States experiencing a rare triple sell-off — where stocks, bonds and the dollar all drop — in response to U.S. President Donald Trump’s announcement of “reciprocal tariffs.” Regarding the actual use of any potential bargaining chip, Kato said, “How — or whether — we use them is a separate decision.”