— BOJ: End-Mar Japan Household Assets -0.5% Y/Y At Y1,476 Trln
— BOJ: End-Mar Drop Marks 4th Straight Y/Y Fall
— BOJ: End-Mar Household JGB Holdings -9.5% Y/Y At Y31.1 Trln
— BOJ: Household JGB Holdings Mark 7 Straight Quarter of Y/Y Drop
— BOJ: Non-Japanese JGB Holdings Y62.0 Trln
— BOJ: Household Cash, Deposits Up 1.5% At Y816.4 Trln

TOKYO (MNI) – Japanese households continued to part the bulk of
their money in safe cash and deposits while increasing investment in
risk assets denominated in foreign currencies for higher returns,
quarterly Bank of Japan data released Friday showed.

The value of financial assets held by Japanese households fell 0.5%
on the year to Y1,476.4 trillion at the end of March, and fell from the
balance of Y1,487.7 trillion at the end of December, according to
preliminary BOJ data.

The 0.5% decrease was the fourth consecutive y/y drop, following a
revised 0.2% fall at the end of December, 2010.

But the value of cash and deposits held by households at the end of
March rose 1.5% on year to Y816.4 trillion, marking the 17th consecutive
quarter of y/y gains, after rising 1.3% at the end of December, the data
showed.

In the January-March quarter, the total average monthly cash
earnings per regular employee in Japan rose 0.1% from a year earlier,
the fourth consecutive y/y rise following +0.2% in October-December.

The BOJ’s preliminary flow of funds data suggests personal spending
is likely to recover for the coming months.

In its monthly economic report for June, the BOJ said: “Private
consumption is expected to pick up due to the improvement in household
sentiment as production recovers.”

The value of foreign currency denominated bonds held by Japanese
households at the end of March totaled Y10.1 trillion, up 8.6% from a
year earlier, with the pace of growth accelerating from a 2.2% rise at
the end of December.

Also, the balance of foreign currency denominated deposits held by
the households at the end of March was at Y5.6 trillion, up 5.9% from a
year earlier and accelerating from a 1.7% rise at the end of December.

Meanwhile, the value of shares and other equities held by Japanese
households at the end of March fell 10.2% year on year to Y90.42
trillion, posting first y/y fall in two quarters after being flat at the
end of December.

The value of investment trusts Japanese households held at the end
of March was down 6.5% y/y at Y53.0 trillion, posting the fourth
consecutive y/y fall after falling 5.5% at the end of December.

The outstanding balance of Japanese government bonds held by
households at the end of March was down 9.5% from a year earlier at
Y31.1 trillion, posting the seventh consecutive y/y drop, with the pace
of decline accelerating from a 5.9% fall at the end of December.

The outstanding balance of JGBs held by domestic financial
institutions at the end of March totaled Y579 trillion, up 3.4% from a
year earlier.

The balance of JGBs held by financial institutions accounted for
66.1% of the total of JGBs at the end of December, down from 66.9% at
the end of December and below a record high level of 67.3% marked at the
end of March 2010.

The data also showed that the outstanding balance of Japanese
government debt including short-term paper held by non-residents at the
end of December totaled Y62 trillion, up 30.8% from a year earlier.

The balance of JGBs held non-residents accounted for 7.1% of the
total JGBs, up from 6.5% at the end of December.

The balance of financial liabilities held by the Japanese
government was at Y1,045.2 trillion, up 4.4% from a year earlier.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4833 **

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