Japanese bond/stock flow data was out today...>

JAPAN: Japanese bond/stock flow data was out today and it shows a significant

change in direction from buying to selling of foreign bonds in the latest week. 

- Japanese trade in foreign bonds went from previously buying Y1.6tln to selling

Y145.5bln. This is in line with a 10 week low for the 10-Year JGB yield from the

June 7th high dropping to around 0.040% and could denote a repatriation of funds

as players try and capitalise on higher prices, yields have fallen further this

week despite the BoJ cutting buying of the 5-10 year sector by Y30bln in the

Rinban operations, this could impact bonds going forward. MNI sources note

upside can be attributed to the unwind of short-flattener trades established in

June. 

-For this exact period last year Japanese investors had already racked up

purchases of Y21tln compared to this year it being Y3tln, it is worth noting

however in the months from August to December last year investors only went on

to purchase a further Y95bln foreign bonds. 

- On a related subject analysts note the pull back of buying operations is

surprising as it comes despite no change in Japan's very low inflation rate