Japan Medium-Term Bonds See Largest Foreign Outflow Since 2006

Global funds sold the largest amount of short- and intermediate-dated JGBs in two decades last month, as persistent yen weakness prompted speculation of yen-supportive monetary policy tightening. The flow suggests rising caution around JGB duration risk and potential increases in yields tied to tighter policy expectations.

Analysis

Global funds sold the largest amount of short- and intermediate-dated JGBs in two decades last month, as persistent yen weakness prompted speculation of yen-supportive monetary policy tightening. The flow suggests rising caution around JGB duration risk and potential increases in yields tied to tighter policy expectations.