Jan 13 (Reuters) – Japanese investors were net sellers of foreign debt in December with U.S. Treasury yields rising, and also sold foreign equities as elevated stock valuations prompted profit-taking.
According to Japan’s Ministry of Finance data, local investors sold a net 374.2 billion yen in foreign long-term bonds last month, partly reversing the prior month’s net 718.9 billion yen investment. They also ditched 350.4 billion yen in foreign stocks.
The Federal Reserve cut rates last month, but indicated borrowing costs are likely to stay restrictive for longer as it expects economic growth to strengthen next year.
Despite the net selling last month, Japanese investors pumped approximately 13.59 trillion yen into foreign bonds in 2025, over a threefold increase from 4.16 trillion yen in net purchases in 2024.
They also added foreign equities of 1.71 trillion yen in 2025, snapping two successive years of net sales.
Last month, life insurers sold 254.3 billion yen worth of foreign long-term bonds, the most since March. Trust accounts also shed 151.9 billion yen worth of foreign long-term debt securities.
Meanwhile, data from the Bank of Japan revealed that Japanese investors offloaded 342.67 billion yen worth of British bonds in November, the most since September 2021, on concerns over the fiscal outlook.
They meanwhile pumped 10.6 trillion yen into U.S. bonds last year to November, and 2.74 trillion yen into European debt securities.
(Reporting by Gaurav Dogra; Editing by Jan Harvey)
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