Japanese Flows Relatively Neutral On Foreign Assets, Foreigners Buy Japan

Japanese weekly international security flow data revealed limited net flows into international bonds and equities on the part of Japanese investors during last week.

• International investor flows surrounding Japanese investors were more interesting.
• Foreign investors lodged a second consecutive weekly round of net purchases of Japanese bonds, aided by the BoJ’s support for its YCC settings (which has been tested once again this week) and perhaps by the relative steepness of the JGB curve/x-ccy basis related yield pickups.
• Elsewhere, foreign investors lodged a third consecutive week of net purchases of Japanese equities.
• Note that net purchases of Japanese bonds and equities on the part of foreign investors pulled back from the levels observed in the previous week.

Source: MNI - Market News/Bloomberg/Japanese Ministry Of Finance