Update on China purchases of Japan government debt

In China purchases of Japanese government debt I suggested that these purchases might prove to be a point of friction between the respective governments. Bloomberg reports today that

“Japan’s government said it will seek discussions with China over the nation’s record purchases of Japanese bonds as an appreciating yen threatens to undermine an economic recovery…Finance Minister Yoshihiko Noda suggested…that it’s inappropriate for China to buy Japan’s bonds without a reciprocal ability for Japanese to invest in China’s market.

“I feel strange that China can buy Japanese government bonds while Japan can’t buy theirs,” Noda said in answering lawmakers’ questions at a hearing on the economy today. “There is a room to discuss that” with Chinese officials, he said. “

The linked Bloomberg piece describes in some detail the limitations China places on foreign purchases of Chinese government debt.  I expect that this will be a long term issue between Japan and China.

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1 Comment »

  1. Update on China purchases of Japan government debt « Wasatch Economics…

    I found your entry interesting do I’ve added a Trackback to it on my weblog :)…

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