Sep. 7 at 8:11 AM
$EWJ Japan may have sold U.S. Treasuries to fund yen intervention
Japan likely sold a portion of its U.S. Treasury holdings to finance its currency intervention over the past month, as its foreign reserves posted their largest decline in August.
Tokyo's reserve assets totaled ~
$1.21T at the end of August, down 6.2% from a month earlier, data from the Ministry of Finance showed.
Foreign security holdings stood at
$839.56B at the end of August, marking a decline of
$87.77B from July-end.
To note, Japan spent JPY 15.4T (over
$98B) on yen intervention between July 30 and Aug. 26, its biggest such operation in a single month. Part of the intervention was conducted jointly with the U.S. to prop up the yen.
"Japan still has room to intervene given the amount of securities it holds, but given comments from Bessent, selling U.S. Treasuries to fund further intervention could end up attracting pressure from the U.S.," Akari Nishimura, economist at the Japan Research Institute, told Bloomberg News.
