(Reuters] – Japanese investors are big buyers of overseas debt. In March, the prices for overseas bonds fell due to inflation concerns and aggressive tightening measures taken by key central banks.

Japan’s Ministry of Finance records show that domestic investors have sold 2.36 trillion Japanese dollars worth of foreign bonds in March, after buying 3.2 trillion in February.

The foreign equity they sold was worth $455.7 trillion yen.

According to Naka Matsuzawa (chief Japan macro strategist, Nomura), “The selling of foreign bonds rose later in the month,” indicating that investors became more concerned about the Federal Reserve’s hawkish turn around FOMC.

Local investors are able to make large sales, despite the steep decline of the Japanese yen during the month.

Japanese investments in overseas assets – https://tmsnrt.rs/3uqEav6

Adam Cole of RBC Capital Markets, Chief Currency Strategist, said that JPY fell in March at a time when investors from the local area were making an unprecedented amount of money home.

He said that most of the bonds being sold had been held on FX-hedging basis. This implies that there is limited FX flow, and reflects the low cost of hedge in the G10 markets over the past two years.

In the first quarter, foreign bonds and equity sales totalled 5.28 trillion yen. This is the highest net sale in eight years.

In March’s monetary policy meeting, the Bank of Japan (BoJ), maintained its huge stimulus amid uncertainties over the global outlook. This reinforced expectations that it would be an exception in the shift to tighter monetary policies.

Bank of Japan’s data showed that Japanese investors purchased U.S. bonds, equities and stocks for 3.11 trillion yen each and 127 miliarde yen respectively during the first 2 months of 2012.

They also bought 1.16 trillion euros worth of European bonds and sold 232 milliards yen in European equity.

Japanese investors also bought Chinese bonds in the amount of 294.69 billion and equity of 25.26billion yen from Chinese banks, according to data as of February.

Japanese investments in US and European assets: https://tmsnrt.rs/3JmULEk

($1 = 124.9900 yen)