Japanese Yen Support Measures Trigger Historic Reserve Collapse

Japan's foreign exchange reserves plummeted by around $80 billion in August, marking a historic collapse of nearly 69 billion euros. The drop represents a 6.18% decrease, the largest percentage decline since data became available in 2000.

The sharp fall comes amidst intense government efforts to bolster the yen against the dollar, which had neared its lowest levels in almost four decades in July.

A senior official cited by Kyodo News attributed the reduction primarily to the decline in market value of sovereign bonds within the reserves, as well as rising interest rates.

Additionally, significant interventions by Japanese authorities in the foreign exchange market between July 30 and August 26 contributed to the decline in reserves.