Japanese investors surge domestic bond purchases as foreign demand falls

Japanese investors significantly increased purchases of domestic government bonds between April and August, acquiring 21.7 trillion yen of coupon-bearing Japanese government bonds. This amount represents 89% of their projected fiscal 2025 total.

Meanwhile, foreign investor demand for Japanese sovereign debt contracted sharply, dropping to just 2.8 trillion yen during the same period. The shift marks a major change in the composition of demand for Japanese government bonds.