Japanese pensions end 2020 by selling foreign stocks to buy foreign bonds while overseas investors start 2021 by buying a record amount of TDBs: The MUFG Global Markets Podcast

Higher U.S. yields have not been tightly correlated to Japanese yields, but they have started to exert a gentle effect. While Japanese non-manufacturers have been hit by uncertainties surrounding the COVID-19 pandemic, Japanese manufacturers are enjoying a recovery for exports and production. The real economy and financial markets have not been moving in tandem. USDJPY, JPY rates, and JPY basis have remained in tight ranges, reflecting risk management mode amidst the pandemic despite a large pick up in cross-border flows at the start of 2021.

In today’s episode, MUFG Chief Japan Strategist, Takahiro Sekido, dissects cross-border flows at the end of 2020 and the beginning of 2021. He also shares his outlooks for Dollar/Yen, Yen rate, and Yen basis.

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