Weekly International Security Flows Pick Up After Turn Of Japanese FY

The latest round of weekly international security flow data revealed that Japanese investors lodged the largest round of net weekly purchases of bonds witnessed since November in the week ending 9 April. Some of this likely reflected continued recycling of offshore equity holdings (which Japanese investors were net sellers of for a 5^th consecutive week), although the net purchases of foreign bonds far outweighed the net sales of foreign equities, which suggests that Japanese investors started to put money to work after the turn of the Japanese FY (we have outlined the attractiveness of both Aussie & U.S. FX-hedged yields at a sovereign level from the perspective of a Japanese investor in recent bullets and analysis pieces).

• The other side of the ledger revealed the largest round of weekly net foreign purchases of Japanese bonds since February 2020, in a week which saw longer dated JGBs find a (short-term) base.

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