Nomura said rising US and European yields and credit‑risk concerns have
materially reduced bond investors' risk tolerance. Investors remain willing to
bet on higher JGB yields but are cautious about positioning for lower yields or
buying duration. After meetings with North American investors Nomura flagged
three priorities: the BOJ's terminal rate level, the pace of further tightening,
and the risk of Japanese investor fund repatriation; it warned that "if US and
European credit concerns deteriorate further, one must also consider the risk
that global rate‑hike expectations could temporarily recede."
