Global fund managers turn bullish on Japanese government bonds

Foreign fund managers moving into longer-dated JGBs is a notable reversal for a market that has long been shunned for its low yields and rate risk, and the involvement of large global houses suggests this is more than a tactical blip. The signal matters most for domestic institutions and pension-type holders who have been underweight duration, since foreign demand can reinforce a yield curve move already underway. Whether the demand recovery and the policy backdrop that these managers cite prove durable — rather than a positioning trade — is the open question to watch.