I just noticed a major move by Japanese investors—they sold a record of over 3 trillion yen in foreign bonds in February, the highest level in 16 months. The main reason is that Japanese bond yields have risen again, making domestic products more attractive than overseas ones.

What stands out most is that they sold a net 3.42 trillion yen in foreign long-term bonds—the highest figure in the past 16 months. However, at the same time, Japanese investors also bought a net 642.1 billion yen worth of foreign stocks, marking the second consecutive month of net buying. Barclays believes this buying is related to Japan’s NISA program, a government initiative aimed at turning household cash into stock investments.

Data from the Bank of Japan also shows that in January, they made a sizeable net purchase of U.S. government bonds. It seems Japanese investors are fine-tuning their portfolios—pulling back from foreign bonds but still maintaining exposure to international stocks.