Japanese investors dump record amount of euro zone bonds in 2024

LONDON, Feb 10 (Reuters) - Japanese investors sold a record amount of euro zone bonds in 2024 led by French debt, according to data from Japan's finance ministry and Barclays.

They dumped 8.6 trillion yen ($56.56 billion) of the bloc's government and non-government debt last year after accounting for purchases, the most seen in data going back to 2014, Barclays said, citing data Japan's finance ministry released on Monday.

The biggest selling was in French debt, where they sold a record 4.7 trillion yen ($30.91 billion), as a snap election in June and July rocked the country's markets and sent the risk premium its government debt pays over Germany's surging.

Just over 50% of French government bonds are held by overseas investors, a much higher proportion than in other big economies, and Japanese investors are thought to be one of the leading holders as a group.

The selling extended to other countries, with the Netherlands seeing 2.1 trillion yen ($13.81 billion) of sales, also a record, Germany 900 billion yen ($5.92 billion) and Italy 700 billion yen ($4.60 billion).

However, selling in French debt slowed in December following larger sales in November, Barclays noted, when former Prime Minister Michel Barnier's government collapsed.

As they sold euro zone bonds, Japanese investors bought a net 5.3 trillion yen ($34.86 billion) of foreign bonds, including 16.1 trillion yen ($105.89 billion) of U.S. bonds, the second largest on record, Barclays said.

Elsewhere, British government bonds saw their largest net buying by Japanese investors since 2018 of 600 billion yen ($3.95 billion) worth.

Barclays