Offshore Investors Continue Equity Purchases, Bond Inflows Rebound

Offshore investors continued purchases of local equities last week. Just under ¥661bn in net inflows were seen. This was the third week of inflows into this segment and the largest weekly inflow since mid-April. Offshore investors were also net buyers of bonds for the first time in 4 weeks. Just under ¥1700bn in inflows were seen, the largest since mid March. It will be interesting to see if this trend continues this week given the general upside bias in yields seen over this period.

• In terms of Japan outbound flows, we saw net selling across both foreign bonds and stocks last week.
• The trend around offshore bonds has been for local investors to sell in recent months. For offshore equities this was the first net weekly sale in 3 weeks.

Table 1: Japan Weekly Investment Flows

Source: MNI - Market News/Bloomberg