Japan Hints at Selling US Bonds to Gain Trade Leverage

Japan’s finance minister stunned trade watchers by suggesting the country might sell part of its massive US Treasury holdings if tariff talks with the Trump administration fail. Such a move could rattle financial markets, since Japan owns over $1 trillion of US debt. Japan’s public threat is unusual—it rarely wields its Treasury holdings as a negotiating chip. The impetus: mounting frustration over surprise US tariffs on Japanese imports. While Tokyo frames the potential bond sell-off as a last-resort measure, even the mention creates market anxiety about rising interest rates and broader financial disruption. Tensions reflect a deepening rift in US-Japan trade relations, prompting analysts to track every sign of compromise or escalation.