Japan Buys Offshore Bonds For 2nd Week, Offshore Investors Dumped Japanese Paper Into BoJ

Weekly international security flow data from the Japanese MoF revealed the largest round of net weekly purchases of foreign bonds on the part of Japanese investors since Nov ’21 (Y1.232tn), with the Fed pivot narrative likely aiding those flows, even with FX-hedging costs remaining elevated. The 4-week rolling sum of the measure flipped into positive territory for the first time since September, after a second consecutive week of net purchases.

• Elsewhere, the well-documented speculation surrounding a YCC tweak ahead of yesterday’s BoJ meeting resulted in notable net sales of Japanese bonds (Y3.896tn) on the part of international investors, which represents the third largest round of weekly net sales on record. That was the 5^th straight week of net sales recorded in the metric.
• Japanese investors were small net buyers of international equities for a 7^th straight week.
• Meanwhile, international investors were small net buyers of Japanese equities.