Japanese investors stepped up their appetite for U.S. sovereign debt in May, buying more than US$20 billion of Treasuries—the heaviest monthly intake since August 2024, according to U.S. Treasury data. The renewed demand lifted Japan’s net holdings at a time when benchmark U.S. yields were hovering around multi-year highs and the yen remained weak against the dollar. Japan’s ¥255 trillion (US$1.7 trillion) Government Pension Investment Fund has been a prominent buyer. The world’s largest pension pool raised the share of Treasuries to 51.8 percent of its foreign‐bond portfolio, the highest level since the fund began disclosing the split a decade ago. Strategists say the wide gap between U.S. and Japanese interest rates makes unhedged Treasury exposure attractive for yield-seeking institutions. The overseas buying spree comes as Tokyo prepares to add supply at home: the Ministry of Finance will auction ¥400 billion of 40-year government bonds on 23 July, followed by regular 10- and 30-year sales on 5 and 7 August. Market participants are watching whether continued foreign interest in higher-yielding U.S. paper will offset potential domestic demand pressures from the forthcoming Japanese issuance.