MNI BRIEF: Japan H’hold Fncl Assets At Record High At End-Sept

The balance of financial assets held by Japanese households rose to a record JPY2,286 trillion at the end of September, up 4.9% year on year for an 11th consecutive quarterly increase, preliminary flow of funds data released by the Bank of Japan on Wednesday showed.

A BOJ official told reporters that rising stock prices and the weak yen were the main drivers behind the increase in household financial assets.

The balance of cash and deposits held by households stood at JPY1,122 trillion at the end of September, up 0.5% from a year earlier, indicating that households remained cautious about sharply increasing exposure to risk assets.

Cash and deposits accounted for 49.1% of total household financial assets, underscoring the continued tendency of Japanese households to refrain from reallocating into riskier investments.

The Bank of Japan’s holdings of government bonds and Treasury bills totaled JPY524 trillion at the end of September, down 8.4% year on year for a seventh straight quarterly decline, and accounted for 44.2% of total government debt, remaining the single largest holder but down from 45.02% at the end of June.

The decline in BOJ holdings reflected the central bank’s reduction in the pace of JGB purchases as well as bond redemptions.

Holdings of government bonds and Treasury bills by non-residents totaled JPY145 trillion at the end of September, up 4.1% year on year for a second consecutive quarterly increase, accounting for 12.28% of total outstanding government bonds, up slightly from 12.26% at the end of June.