The latest round of Japanese weekly international security flow data revealed that Japanese investors lodged that largest round of weekly net purchases of foreign bonds observed since January, registering a third consecutive week of net purchases in the process. This comes after the market vol. witnessed in May through July, coupled with elevated FX-hedging costs, resulted in a record streak of net sales across the 8 weeks prior to the current run of net purchases.
- Elsewhere, foreign investors bought more than Y1tn of Japanese bonds in net terms for the fourth time in five weeks, with the latest round of purchases likely representing short covering of existing JGB positions, foreign investors looking to take advantage of FX-hedge-related yield pickups, or a mixture of the two.
- When it comes to equities, Japanese investors shed over Y1tn of net exposure to foreign stocks last week, ending a streak of seven consecutive weeks of net purchases, registering the largest round of net weekly sales observed since April in the process.
- Finally, foreign investors were marginal net buyers of Japanese equities last week.
| Latest Week | Previous Week | 4-Week Rolling Sum | |
|---|---|---|---|
| Net Weekly Japanese Flows Into Foreign Bonds (Ybn) | 827.0 | 37.8 | 68.2 |
| Net Weekly Japanese Flows Into Foreign Stocks (Ybn) | -1036.7 | 355.6 | -129.1 |
| Net Weekly Foreign Flows Into Japanese Bonds (Ybn) | 1027.5 | 1289.8 | 4055.0 |
| Net Weekly Foreign Flows Into Japanese Stocks (Ybn) | 61.0 | -120.9 | 712.7 |
Fig. 1: Net Weekly Japanese Flows Into Foreign Bonds (Ybn)
Source: MNI - Market News/Bloomberg/Japanese Ministry Of Finance
Fig. 2: Net Weekly Foreign Flows Into Japanese Bonds (Ybn)
Source: MNI - Market News/Bloomberg/Japanese Ministry Of Finance
