Taisuke Tanaka, Research Analyst at Deutsche Bank, notes that according to Japan's foreign securities investment statistics, Japanese investors (excluding the mostly currency-neutral banking sector) were net buyers of foreign stocks by ¥831.8bn and of foreign bonds by ¥677.9bn in January. Key Quotes “Net buying amount for foreign stocks topped November's ¥526.3bn and December's ¥251.9bn as index-based investors (eg, pensions) bought on dips in response to falling stock prices and a higher JPY. In contrast, net buying amount for foreign bonds has been decreasing since October 2015. Amid global risk-averse symptoms, the USD/JPY fell to the 115’s at one point in January. Although Japanese investors were robust foreign-currency buyers on dips, mainly of USD-denominated securities and led by pensions, total amount was modest. Buying on dips by Japanese investors continues to support the USD/JPY, but we need to bear in mind that momentum is no longer as strong as last year. Application of negative interest rates to a part of BoJ current-account deposit begins from 16 February. JGB yields already down, and pressure is gradually rising for Japanese real money to flow into foreign markets. However, as long as the global risk-averse environment persists, it is difficult to envisage Japanese investors reviving their FX investment substantially. We err more on the cautious side, looking for the USD/JPY to hold at the 115-120 range for the foreseeable future.” For more information, read our latest forex news.