According to Sina Finance, PGIM Fixed Income global investment strategist Guillermo Felices said the selloff in French government bonds could prompt Japanese investors to repatriate funds and may mark a turning point for the yen.

Felices said Japanese investors have long been major buyers of French bonds, so France's current turmoil may make them more cautious about whether it is worth investing in Japanese assets now, given higher yields. He added that if investors ultimately conclude Japan's fiscal policy is more sustainable than France's or other countries', that would also be a positive for Japanese assets. Hedging costs, especially dollar-denominated costs, remain high for Japanese investors, which makes them more inclined to keep funds at home.