Japan's forex reserves fall $79.6 billion in August after yen intervention

September 7, 2026 at 12:49 PM1 min

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Japan's official foreign exchange reserves fell by $79.6 billion in August to $1.208 trillion, the Ministry of Finance said. The drop followed record yen-buying intervention of 15.4 trillion yen between July 30 and August 26. The decline was driven by an $87.8 billion reduction in foreign securities holdings.

Key Facts

Japan's foreign exchange reserves fell 6.18% in August, from $1.287 trillion at end-July to $1.208 trillion at end-August.
Japan spent 15.4 trillion yen (about $98.66 billion) on yen-buying intervention between July 30 and August 26.
Foreign securities holdings were reduced by $87.8 billion in August to finance the intervention.
The U.S. Treasury intervened in the currency market on July 31 for the first time since 2011 to support Japan's yen operations.

Reserve Decline

Japan's official foreign exchange reserves fell by $79.6 billion in August, one of the sharpest monthly declines on record, according to Ministry of Finance data. Reserves stood at $1.287 trillion at the end of July and dropped 6.18% to $1.208 trillion by the end of August. The decline was driven mainly by a reduction in foreign securities holdings, which account for about 70% of Japan's portfolio and consist largely of U.S. Treasury bonds. Tokyo reduced foreign securities assets by $87.8 billion in August to finance the market intervention.

Intervention and U.S. Cooperation

Japan intervened in the currency market between July 30 and August 26, buying yen and selling foreign currencies to stem the yen's decline. The operation totaled 15.4 trillion yen, approximately $98.66 billion. On July 31, the U.S. Treasury entered the market directly for the first time since 2011 to actively support Japan's yen intervention. Economists note that continued sales of U.S. Treasuries to fund interventions could create financial pressure on Washington, potentially prompting the Federal Reserve to provide liquidity facilities in future steps.