Japanese funds withdraw from US bonds? What does Sumitomo Mitsui's investment shift reveal

Question

【Blockchain Rhythm】A question worth pondering: what happens if Japanese investors start withdrawing their money from the domestic market and no longer continuously support the US bond market?

This is not alarmist. The recent actions of Sumitomo Mitsui Financial Group, Japan’s second-largest bank, illustrate this possibility. According to reports, the institution actively reduced its holdings during the period of soaring Japanese government bond yields, but once this surge ended, they were prepared to rebuild their Japanese government bond positions on a large scale—potentially doubling the current level up to twice as high.

The logic behind this is clear: domestic bond yields have become more attractive, so why stick to US bonds? Although this shift in capital flow seems to be a matter of the bond market, it can trigger chain reactions in global asset allocation, exchange rate fluctuations, and even liquidity in the crypto markets. As one of the major holders of US debt, Japan’s change in investment preferences is definitely worth paying attention to.

ClassicDumpster · Accepted Answer

The Japanese funds withdrawing from US bonds, to put it simply, are driven by yields. Sumitomo Mitsui's move is quite clever; local yields have doubled, so who still cares about US bonds?

SignatureDenied · Answer

The wave of US debt is indeed cooling off

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The Japanese brothers are starting to play their own game, the Federal Reserve's days are not easy

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Wait a minute, if there is a large-scale withdrawal, the liquidity in the crypto market will be severely affected

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Sumitomo Mitsui's move is a bit ruthless, doubling down on Japanese bonds? It seems that the yields in Japan are indeed attractive

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Speaking of which, the supporters of US debt are all fleeing, this is the real risk

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Crypto still depends on the face of US debt; if funds really start to reallocate, it will be interesting

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Smart money is pulling back, this signal is a bit meaningful

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Is US debt becoming a hot potato?

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Japan is betting on its own bonds, is this a gamble on the appreciation of the yen?

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With liquidity being drained, the first to suffer will definitely be high-risk assets. What do you think?

WhaleMinion · Answer

U.S. Treasuries are going to cool off, this time it's for real

Japan has turned around; who still stubbornly clings to the dollar paper?

Recovering their own bonds, this logic makes sense... We should keep an eye on the crypto space

On the day U.S. Treasuries collapse, where will the liquidity go? That's the real issue

The era of fools with lots of money is coming to an end

CantAffordPancake · Answer

Wait, are US Treasuries really about to be abandoned? This is the big event.

It seems Japan has also started to "sweep its own doorstep snow." Who still foolishly clings to US Treasuries when their own yields are already so high?

If liquidity really becomes tight, the crypto market will collapse in an instant.

FloorSweeper · Answer

The Japanese are also starting to get smart; returns really can change everything.

Are US bonds about to fall behind? Sumitomo Mitsui's recent moves look like they're fleeing.

Wait, will this really affect liquidity in the crypto market? Or is it just the same old story?

If Japan withdraws money, will the dollar also depreciate... feeling a bit anxious.

This is the real crisis signal, not those things that are hyped up every day.

Japanese funds withdraw from US bonds? What does Sumitomo Mitsui's investment shift reveal

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