Japanese demand for foreign equities has weakened – RBC CM

Adam Cole, Research Analyst at RBC Capital Markets, notes that the Japanese demand for foreign equities has weakened and Japanese investors have been net sellers of foreign bonds in the September so far (weekly data due overnight).

Key Quotes

“This, however, follows extremely heavy outflows over the summer and may reflect the approach of fiscal half year this week. In our view, the FX flow generated by new investment is likely to have been overwhelmed recently by flow generated by the rehedging of existing investments (which is positive JPY).”