Japan's official foreign reserves fell by a record $80 billion in August, dropping to $1.207 trillion following intervention in the currency market to support the yen.
Key facts
- Japan's foreign reserves fell by a record $80 billion in August.
- Reserves stood at $1.207 trillion, down from $1.287 trillion in July.
- The decline followed intervention to support the yen.
- The figures come from finance ministry data.
Japan’s official foreign reserves dropped by a record $80 billion in August, according to finance ministry data cited by CNBC. The reserves fell to $1.207 trillion, down from July’s figure of $1.287 trillion.
The decline followed intervention in the currency market to support the yen. Foreign reserves typically fall when a government sells foreign assets to buy its own currency, a step taken to influence the exchange rate.
The record scale of the monthly drop underscores the size of the action taken during the month. The reduction of $80 billion represents a notable share of Japan’s overall reserve holdings.
Even after the decline, Japan’s reserves remain substantial at more than $1.2 trillion, leaving the country with significant capacity in its holdings.
The finance ministry data provides the official measure of the change, offering a snapshot of the reserve position at the end of the reporting period.
Why it matters
Foreign reserves are a key gauge of a country's financial firepower, and a record monthly drop signals large-scale efforts to steady the yen. Currency intervention on this scale can affect exchange rates, trade costs and investor sentiment far beyond Japan's borders.
Frequently asked questions
How much did Japan's foreign reserves fall in August?
Japan's foreign reserves fell by a record $80 billion in August, according to finance ministry data cited by CNBC.
What are Japan's foreign reserves now?
Reserves stood at $1.207 trillion, down from July's figure of $1.287 trillion.
Why did the reserves drop?
The decline followed intervention to support the yen, according to the reported finance ministry data.