The Nikkei is carrying a story this morning saying moves into foreign securities by Japanese insurers hold the key to yen direction in this new fiscal year (F2013 begins today in Japan). Falling yields in Japan may pressure investors there to look offshore for better returns. If investors (not just insurers, but all classes of fund managers, pension funds etc.) purchases foreign securities it will be another source of pressure on the yen.
Recent posts on this subject:
- Maybe the BOJ wont need to buy foreign bonds (& check the comments for a contrary view)
- Japan’s largest mutual fund adds Singaporean bonds to its portfolio for the first time
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USD/JPY is steady around 94.30.
