Funds Fleeing Japan Bonds Adds to Pressure on BOJ Yield Policy
- Sale of 20-year sovereign debt drew weakest demand in a decade
- Overseas outflows climb to highest in about three months
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Demand is collapsing for Japan’s sovereign bonds, with foreigners selling out and a poor showing at an auction testing the central bank’s yield curve control.
A gauge of demand at a sale of 20-year sovereign debt fell to the lowest in a decade Thursday, reflecting the pressure from rising global yields and a weakening yen. On top of that, overseas funds sold almost 2.6 trillion yen ($18.1 billion) of mostly government bonds last week, the biggest withdrawal since mid-June.