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Foreign-Reserve Managers Cut Yen Assets by Most in Nine Years

  • Incentive to hold yen declines due to move in dollar-yen basis
  • Demand for yen set to rebound as drop was excessive, MUFG says
Stock of Japanese Yen and US Dollars Ahead of British EU Referendum Vote
Photographer: Tomohiro Ohsumi/Bloomberg

Global foreign-exchange reserve managers cut yen holdings by the most since 2008 in the first quarter as the incentive for holding Japan’s currency decreased.

Reserve managers trimmed yen-denominated assets by 2 trillion yen ($18 billion) to 53.2 trillion yen in the three months through March 31, based on International Monetary Fund data after taking account of foreign-exchange fluctuations. They boosted dollar holdings by $217 billion to $6.5 trillion.