Berkshire Hathaway’s Cautious Issuance of Japanese Bonds: Is Buffett Buying the Dip in Japanese Stocks and Exiting U.S. Equities?

TradingKey – Amid a sharp downturn in both U.S. and Japanese equities triggered by President Trump's renewed tariff policies, Warren Buffett’s Berkshire Hathaway (BRKB.US) has returned to Japanese bonds. While this latest bond issuance is the smallest since Berkshire entered  Japan in 2019, it has nonetheless reignited speculation that Buffett is ramping up his investments in Japanese stocks. 

On Friday, April 11, Berkshire issued 90 billion in yen-denominated bonds—its smallest offering in the market to date—signalling what some analysts interpret as a “cautious” approach

As the U.S.-driven  trade conflict sends ripples through global markets, the U.S. Treasury market has been particularly volatile. Japanese bonds have also come under pressure, with yields climbing for several consecutive sessions. Against this backdrop, Berkshire’s move stands in stark contrast to the growing number of Japanese companies delaying or canceling planned bond issuances due to rising borrowing costs.

Analysts suggest the proceeds from Berkshire’s bond sale may be used to increase its stakes in Japanese equities. In mid-March, the firm disclosed it had expanded its holdings in Japan’s five major trading houses—Mitsubishi Corporation, Mitsui & Co., Itochu Corporation, Sumitomo Corporation, and Marubeni Corporation.

In Berkshire’s annual letter to shareholders published in February, Buffett expressed confidence in the capital allocation, management quality, and shareholder-friendly practices of these firms. He reiterated that Berkshire’s investments in the five trading houses are long-term in nature and signalled the possibility of further increases.

As of April 11, the Nikkei 225 index had dropped 4.22% to 33,148.45, following steep overnight declines in U.S. equities. The index has now fallen nearly 7% since the start of April.

Although Berkshire has repeatedly emphasised that the U.S. remains at the core of its investment strategy, the company has significantly pared back its holdings in Apple, Bank of America, and other U.S. stocks this year. Its cash position now reportedly makes up nearly 50% of its portfolio.

This shift has enabled Buffett to sidestep steep losses in U.S. bank stocks, which have declined more than   20% year-to-date, as well as the broader tech sector’s valuation reset. As a result, Buffett’s net worth has risen despite the market downturn—making him the only billionaire in Bloomberg’s top ten to register a gain this year—while Berkshire shares are up   14%.

Buffett’s retreat from U.S. equities aligns with a broader market sentiment of declining confidence in dollar-denominated  assets.” As Trump escalates his tariff offensive, even traditionally safe-haven U.S. Treasuries are being dumped by risk-averse investors, marking a notable shift in global capital flows.