Japanese Investors Sell Foreign Bonds for Fifth Straight Week as Domestic Yields Rise

Japanese investors sold foreign bonds for a fifth consecutive week through October 17 — their longest selling streak in four years — as rising domestic yields draw capital back into Japanese government bonds. Net sales of foreign long-term bonds totaled 161.6 billion yen ($1.02 billion), the smallest of the streak, plus 156.9 billion yen of short-term bills, Ministry of Finance data showed. The five-week total reached about 3.43 trillion yen, lifting year-to-date net sales to 5.18 trillion yen, the largest for the comparable period since 2022. The benchmark 10-year JGB yield has climbed more than 80 basis points this year, though safe-haven buying has pulled it back from a three-decade high hit in October. Selling slowed as the 10-year US Treasury yield retreated roughly 27 basis points from a 24-1/2-year high of 5.3645% earlier this month. Domestic banks have led the selling, while life insurers have signaled plans to maintain or raise domestic bond purchases in the fiscal second half; their investment plans are in focus this week.