Japanese investors pulled money from foreign bonds for a second successive month in September
TLT•Japanese investors sold a net 969 billion yen ($6.13 billion) of foreign bonds in September, following 1.16 trillion yen in net sales the previous month. Year-to-date net sales reached about 5.08 trillion yen, the most since 2022.
1. September bond flows
Japanese investors sold a net 969 billion yen of foreign bonds in September, as rising borrowing costs in the United States and Europe and more attractive domestic yields prompted a retreat from overseas debt. They sold 1.43 trillion yen of long-term bonds, the most in six months, while buying roughly 457 billion yen of short-term bills.
2. Institutions diverged
Japanese banks sold a net 2.49 trillion yen of foreign long-term bonds, the most in seven months. Life insurers and investment trust management companies also recorded net sales, while trust accounts bought a net 1.2 trillion yen of foreign long-term bonds.
3. Year-to-date sales
Japanese investors have made net foreign bond sales of about 5.08 trillion yen so far this year, the most since 2022. A separate Bank of Japan report showed net sales of 4.74 trillion yen of U.S. bonds in the first eight months of the year, while investors bought a net 355.85 billion yen of European bonds.
