Japan Turns to Alternative Yen Defense Tools Amid Low Cash Reserves

Japanese authorities have alternative tools to defend the yen without selling its US Treasury holdings, according to Citigroup Inc.

The country's short-term debt holdings are running low, with over $1.1 trillion in US Treasuries on hand. However, Citi strategists argue that there is another option available: the Federal Reserve's Foreign and International Monetary Authorities Repo Facility.

This facility enables overseas central banks to use their Treasury holdings as collateral to access dollars without having to sell the bonds to raise cash.