Updated
Updated · Bloomberg · Jun 8
Japanese Trust Accounts Buy Record $19.7 Billion Foreign Bonds in May Despite Higher Local Yields
Updated
Updated · Bloomberg · Jun 8

Japanese Trust Accounts Buy Record $19.7 Billion Foreign Bonds in May Despite Higher Local Yields

1 articles · Updated · Bloomberg · Jun 8

Summary

  • ¥3.16 trillion in net foreign-bond purchases by Japanese bank trust accounts in May marked the highest monthly total in Ministry of Finance data going back to 2005.
  • The buying, often seen as a proxy for Japanese pension-fund demand, added to evidence that appetite for overseas debt stayed strong even as domestic yields climbed.
  • Preliminary figures released Monday suggest Japanese institutional investors continued to favor foreign fixed-income markets despite improving returns at home.

Insights

With Japan's domestic bond yields at 30-year highs, why are its pension funds still sending record billions abroad?
As the world's top creditor, is Japan's record bond purchase a global lifeline or the start of a new financial risk?