Japan may sell off $87.8 billion in foreign securities (including US Treasuries) to fund record yen intervention

(1) According to foreign media analysis, data from Japan's Ministry of Finance showed that as of the end of August, Japan's holdings of foreign securities decreased by 87.8 billion US dollars compared to the previous month, a decline highly consistent with the recent intervention scale to support the yen. (2) The Ministry of Finance had previously confirmed that, within the one-month period ending August 26, authorities utilized a record 96.4 billion US dollars to intervene in the foreign exchange market, with part of the operations conducted jointly with the United States. (3) Although the data does not provide detailed classifications of securities holdings or maturity dates, the market estimates that about 70% of Japan's foreign reserves are invested in US Treasury bonds, which means that this reduction most likely mainly involves US Treasuries.