Japanese banks were already returning to U.S. Treasuries before a plunge in global markets made Federal Reserve rate increases an even more distant prospect.
The lenders bought a net ?855 billion of medium- to long-term foreign bonds in July, and their purchases reached a three-month high in the week of Aug. 9 to Aug. 15, Finance Ministry data show. That marked a reversal after they sold a net ?5.2 trillion in the three months to June, about 12 times more than a year earlier.
¡°The bias on foreign bonds is to buy,¡± said Makoto Noji, senior interest rate strategist at SMBC Nikko Securities Inc. in Tokyo. ¡°There¡¯s no question that holdings will rise.¡±
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