JPY: Searching for yield in A$ non sovereign debt? - Westpac

Martina Song, Research Analyst at Westpac, notes that the Japan Mar balance of payments data showed that Japanese investors sold A$2.19bn of Australian sovereign debt, the most since Jan 2013.

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“This however was offset by the buying of A$1.81bn of Australian dollar nonsovereign debt, the most since Jan 2015 and A$0.40bn of equity. Net purchases of Australian sovereign bonds in the year to Mar were almost fl at, while A$4.36bn of non-sovereign debt was bought over the same period.

Japanese buying of US dollar bonds was at a record high of ¥5.09tn /US$45.18bn in Mar; the ¥6.533tn yen/US$58.45bn of buying in the last three months is also historically very high. This suggests that the search for yield continues, with Australian and US debt now both considered high yielding.”