Japanese investors’ demand for overseas debt has waned in the past year due to rising foreign-currency hedging costs. The prospect of adjustments to Bank of Japan (BOJ) yield curve control strategy suggests that this demand will remain weak as yields on long-term domestic debt rise, says Fitch Ratings. Decades of ultra-low interest rates at home had encouraged yield-seeking Japanese private institutional investors to park their savings overseas, particularly in foreign bonds, such as US Treasurys. “Japanese investors’ demand for foreign bonds has faltered in the past year despite rising interest rates in the US and ... (full story)