Japanese yields shift global capital flows
The rise in yields on Japanese 10-year bonds to over 3% for the first time since 1996 has attracted domestic capital and led to a gradual decline in Japanese holdings of foreign debt, which amounted to $2.4 trillion. This shift is attributed to expectations of an interest rate hike by the Bank of Japan and increasing pressures on borrowers, as well as Japanese investors' desire to reallocate their funds and achieve better returns domestically. These factors threaten to gradually change their investment patterns and reduce their reliance on foreign bonds.
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