Al Dhabi Capital's Garg expects inflows to slow down given the breakthrough in U.S.-China tariff talks, and also as deals with other countries are likely. Britain in fact became the first country to ink a deal with the U.S. last week. While historic monthly inflows may not continue, market watchers still have a positive outlook on Japanese assets and continue to see strong inflows. Trump's unprecedented actions and policy flip-flops have dented U.S. credibility and confidence in its assets, and this could still result in global fund managers investing less in the U.S. markets in favor of others, explained Vasu Menon, OCBC's managing director of the investment strategy team. "Given such a backdrop, demand for Japanese assets may remain healthy even if it is not as a strong as the April level," he said. Japan's ongoing talks with the U.S. with regards to tariffs have also raised some optimism over cutting the 24% "reciprocal" tariffs on Japan, Menon said. Japanese shares will also benefit from the Tokyo Stock Exchange's corporate governance reforms, which has prioritized shareholder returns, Asset Management One International wrote in note. The TSE's corporate governance reforms, which kickstarted in March 2023, warrant listed companies whose shares trade below a price-to-book ratio of one to "comply or explain." The initiative aims to boost Japan Inc.'s appeal to both foreign and domestic investors. This reform program has led to likely record levels of share buybacks in Japan, which improves both earnings per share and support share price, Asset Management One International said. While the dollar has regained some strength following April's sell-off, the potential for it to weaken further and the Japanese currency to strengthen "makes sense" for investors to look at Japanese equities especially as the economy rebounds, said Neuberger Berman's Okamura. "So this trend has legs. Japan will likely continue to see good flows," Okamura said. Morningstar's Makdad sees more net inflows into Japanese equities than in the past decade amid the improved corporate governance. That said, he does not see the same heft of net inflows into short-term Japanese Treasury bills as when the Bank of Japan was implementing negative interest rates as the arbitrage opportunity for some foreign investors that existed then is no longer present now.