Tokyo’s exclusive group of government bond traders enjoys demand amid policy shift

When the Hiroyuki Kubota party for Japanese government bond traders and strategists resumed last fall after a hiatus of several years, there was cause for celebration.

The veteran group suddenly came back into fashion. The world’s biggest hedge funds began focusing on the Bank of Japan reversing its ultra-loose monetary policy, shaking up a once-sleepy corner of global finance by hiring a steady stream of traders with expertise in Japanese sovereign debt. Volatility in Japan’s 1.142 trillion yen ($7.1 trillion) government bond market surged to levels not seen since the 2008 financial crisis.

Gossiping over sake and tempura, the group of mostly Japanese-speaking men in their 50s and 60s were so engrossed in their conversation that few ventured out onto the deck to admire the Tokyo skyline, said Kubota, a former JGB dealer who started the near-annual event in 1998 by inviting members of his online chat room for government bond traders.