Japanese investors end six-week retreat from foreign long-term bonds

Net buying of overseas long-term debt by Japanese investors reached 1.31 trillion yen for the week ending October 31, according to Japan's Ministry of Finance. It was their first weekly net purchase in seven weeks, following cumulative sales of 3.51 trillion yen.

The return to longer-term bonds came as technology shares declined and the Federal Reserve kept interest rates steady. Purchases did not extend to foreign short-term bills, which Japanese investors sold on a net basis by 209.3 billion yen.

Capital also flowed into Japan's debt market from abroad. Foreign investors' net bond purchases amounted to 2.36 trillion yen, a level not seen since March 21. Longer-term bonds accounted for 1.48 trillion yen, while short-term bills attracted 874.7 billion yen.

Equity flows were positive in both directions. Net purchases of overseas stocks by Japanese investors totaled 1.08 trillion yen, marking a third successive week of buying. Investors from abroad added 1.13 trillion yen in Japanese shares, their second consecutive weekly net purchase.

For the year to date, net outflows from foreign fixed-income assets held by Japanese investors remained at 4.38 billion yen. That was the largest withdrawal for the corresponding period since 2022.