• Japanese investors are bullish on Japan 
  • Local optimism is being expressed through equities, not FX 
  • Institutional and retail positions in USD-JPY have been significantly reduced
  • Japanese investors and corporates continue to move capital overseas 
  • US fixed income markets remain the overseas destination of choice 
  • Eric Robertsen of Standard Chartered comments, “A big focus of domestic investors was the change in correlation between USD-JPY and the Nikkei as the Nikkei has made new highs while USD-JPY has weakened. As recently as February, the 30-day rolling correlation between the two markets was as high as +0.60, but it has fallen recently to marginally negative levels.”  
  • “Weekly data from the Ministry of Finance (MoF) continues to highlight that Japanese investors are buying overseas stocks and bonds. Government pensions had already been buying overseas assets, and private pensions are now following suit. However, it is not just investors who are looking overseas – corporate decision-makers are increasingly looking beyond Japan for M&A opportunities.” 

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