Latest JSDA data released shows that..........>

JAPAN: Latest JSDA data released shows that foreigners turned net buyers of

superlong JGB's in November and recorded the biggest purchase in 2017 as

widening USDJPY basis swaps helped the appeal of JGB yield levels. Foreigners

bought a net Y420.1bln of superlong JGB's. Barclays note that "Foreign investors

appear to have been keen on flattener trades in light of expected cuts in

superlong bond issuance (30y, 40y) in JGB issuance plans for FY18."

- Superlong bonds were also attractive to domestic investors, large Japanese

banks bought a net Y316.4bln net purchase, the first net purchase since August.

Insurers kept their superlong purchases steady at Y209.3bln.

- Conversely Japanese investors reduced positions in foreign bonds, large banks

were net sellers of foreign bonds for the fourth successive month. Current

account data suggest US bonds were sold the heaviest, wider USD/JPY basis swaps

can be given the blame with USD demand heavy into year end.

- City Banks turned net sellers in the short end and the belly after large net

buys in the previous month, MNI sources note some profit taking in the sector, a

move that has driven yield increases in the sector.