Japan's Foreign Currency Deposits Surge Nearly ¥4 Trillion in a Single Quarter, Marking the Largest Increase Since Liberalization in 1998
Nashnova编辑部
Japan's foreign-currency deposits jumped ¥3.98 trillion in Q2, the largest single-quarter increase since the country fully liberalized such accounts in 1998 — households and corporations are moving money out of the yen in tandem, locking in structural selling pressure.
How big is this move?
The single-quarter increase hit ¥3.98 trillion (≈$25.1 billion), lifting total foreign-currency deposits to ¥26.1 trillion, up 18% year-on-year.
This means → the quarterly outflow into foreign currencies exceeded Japan's entire annual trade deficit (¥1.7 trillion for FY2025) — capital is leaving faster than trade is bleeding.
A stronger dollar did inflate the yen-denominated figure, but even after stripping out exchange-rate effects, the underlying inflow remains substantial.
Why are ordinary savers moving money out?
Retail foreign-currency deposits grew 8% to ¥6.7 trillion. Sony Bank disclosed in May that its foreign-currency balance reached ¥800 billion — just 15 months after crossing ¥700 billion.
A Tokyo salaryman in his 40s has been putting 2–3% of his monthly pay into a dollar account since the Bank of Japan introduced negative rates in 2016. His logic: "The yen could weaken further — holding only yen is itself a risk."
This reflects a behavioral shift among retail investors. Previously they bought foreign currencies on yen-strength dips; now they are buying even at 39-year lows, and the pool has widened to retirees deploying their savings.
What about corporates?
Corporate foreign-currency deposits jumped 22% year-on-year to ¥19.3 trillion — the main driver of the overall surge.
This means → exporters earning dollars are choosing not to convert back to yen, betting that yen weakness will persist. Companies planning overseas expansion are also stockpiling dollars in advance.
Japanese firms are issuing more foreign-currency bonds too. In plain terms = corporations are both keeping revenue offshore and actively borrowing in foreign currencies — two lanes accelerating de-yenification at the same time.
Beyond deposits — where else is the money going?
As of end-March, Japanese households held ¥46.46 trillion in foreign securities, up 23% year-on-year.
Mitsubishi UFJ's eMAXIS Slim Global Equity fund hit a record ¥13 trillion in net assets, with roughly 60% allocated to U.S. stocks.
In plain terms = deposits, securities, and funds are three parallel pipelines moving money offshore — the structural selling pressure on the yen is not a one- or two-quarter story.
What does this mean for the yen?
The yen fell to around 163 per dollar in July, a 39-year low.
The relentless expansion of foreign-currency deposits signals that the yen's problem is not short-term speculative pressure — it is structural selling driven by households and corporates voting with their wallets.
This reflects a deeper signal: when ordinary savers and businesses are systematically reducing yen exposure, the currency's weakness may prove more persistent than markets currently price in.
Content is for reference only, not financial advice.