Cash Levels Rise In Japan as Investors Choose Wait-and-See
- Japanese cash level high as investors sell foreign bonds, JGBs
- Super-long bonds may attract funds but investors won’t rush
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Japanese investors’ wait-and-see approach this year is leading to a growing problem. Cash.
Having sold a record amount of overseas bonds in April, as well as domestic debt, investors have mostly held off reinvesting the proceeds. Excess reserves at the Bank of Japan from the country’s financial institutions, subject to a 0.1 percent charge, reached the highest in 13 months in April. A redemption of government bonds in June is likely to add to this cash pile, as quarter-ending months typically see four-to-five times more money returned.