Foreign investors sold a net 1.28 trillion yen of two-year and five-year Japanese government bonds in July, the largest net selling since 2006, as the yen kept weakening and fueled expectations that the Bank of Japan may accelerate interest rate hikes. Data from the Japan Securities Dealers Association showed that foreign investors remained net buyers of long-term bonds with maturities over 10 years, worth 889.8 billion yen in the same month, indicating that selling was concentrated in short- to medium-term bonds, which are more sensitive to the interest rate outlook. The selling came as the yen hit its weakest level in nearly 40 years, prompting joint market intervention by Japan and the United States, while Bank of Japan Governor Kazuo Ueda signaled that policy could be adjusted at the September meeting.
Foreign investors dump 2Y JGBs, largest since 2006, on BOJ rate hike bets
Foreign investors dump 5Y JGBs, largest since 2006, on BOJ rate hike bets
Foreign selling of short/medium JGBs and BOJ hike expectations push 10Y yield up
