The International Monetary Fund (IMF) has uncharacteristically endorsed Japan's monetary policy normalization, with Krishna Srinivasan, Director of the Asia and Pacific Department, stating during the IMF Annual Meetings in Bangkok this week that the Bank of Japan (BOJ) "is doing the right thing" and warning that if inflation rises faster than expected, "they must tighten faster." This statement comes as global bond markets are under pressure, with the French 10-year government bond yield briefly approaching 5% (a new high since 2002) and the US 10-year government bond yield climbing to a multi-decade high of 5.28%. Analysts believe that Japan's policy normalization and the resulting repatriation of Japanese capital could be one of the structural forces behind the global bond market turmoil. Data shows that as of July this year, Japanese investors' holdings of French government bonds decreased by 2.5% compared to the end of last year, and funds under Sumitomo Mitsui DS Asset Management have liquidated their French bond holdings.