I need to do some research into capital flows from Japan, but the anecdotal evidence has been steady in recent weeks. Virtually every report I hear of real-money activity (asset-managers, pension funds, endowments, etc) is that they are steady buyers of dollars, sellers of JPY. It looks to me as though these accounts are pulling money out of Japan. Not good news for the government even if it does slow the decline of the dollar…
Japan is going to become increasingly reliant on foreign investors in the years to come as its population ages and its current account surplus withers.
USD/JPY trades at 81.82 after real money buying in the high 81.70s. We sit a mere 2 yen above all-time dollar lows from 1995.
