TOKYO (MNI) – Japan’s foreign reserves fell to $1.101 trillion at
the end of November from a record high $1.118 trillion at the end of
October, posting the first month-to-month decline in six months, the
Ministry of Finance said on Tuesday.
The Japanese government conducted no foreign exchange intervention
in November or October.
In September, the reserves were pushed up by the large-scale forex
intervention to sell yen for the U.S. currency that Japan conducted for
the first time in over six years in a bid to prevent the yen’s rapid
rise from hurting exporter profits and thus a sustained economic
recovery.
The country’s forex reserves remain the second largest in the
world, next to China’s which are estimated at $2.65 trillion at the end
of September.
Foreign exchange reserves consist of securities and deposits
denominated in foreign currencies, International Monetary Fund reserves,
IMF special drawing rights (SDRs) and gold.
At the end of last month, Japan’s foreign currency reserves stood
at $1.042 trillion, IMF reserves at $4.43 billion, SDRs at $20.44
billion, gold at $34.04 billion and other reserve assets at $440
million.
Japan’s forex reserves are closely watched for evidence of how the
country is managing its vast foreign currency holdings.
The biggest changes in Japan’s forex reserves usually occur when
the Bank of Japan intervenes in the currency market on behalf of the MOF
to prevent a steep appreciation or depreciation of the yen.
Before the large-scale intervention to sell a total of Y2.125
trillion for the U.S. dollar on Sept. 15, 2010, Japan had stayed out of
the forex market since mid-March 2004, when it ended its massive
15-month-long yen-selling operation.
tokyo@marketnews.com
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[TOPICS: M$J$$$,M$A$$$,MAJDS$]
