REUTERS
"China's holdings of U.S. Treasuries skid to 12-year low; Japan also cuts holdings"
By Gertrude Chavez-Dreyfuss
JUNE 15, 2022
NEW YORK (Reuters) - China’s holdings of U.S Treasuries tumbled in April to their lowest since May 2010, data showed on Wednesday, with Chinese investors likely cutting losses as Treasury prices fell after Federal Reserve officials signaled sizable rate hikes to temper soaring inflation.
Chinese holdings dropped to $1.003 trillion in April, down $36.2 billion from $1.039 trillion the previous month, according to U.S. Treasury Department figures.
China’s stock of Treasuries in May 2010 was $843.7 billion, data showed.
The reduction in Treasury holdings may also have been aimed at diversifying China’s foreign exchange holdings, analysts said.
The Chinese sales contributed to a drop in overall foreign holdings of Treasuries in April that helped propel yields higher.
U.S. benchmark 10-year Treasury yields started April with a yield of 2.3895%, and surged roughly 55 basis points to 2.9375% by the end of the month.
Japan’s holdings of U.S. Treasuries fell further in April to their lowest since January 2020, amid a persistent decline in the yen versus the dollar, which may have prompted Japanese investors to sell U.S. assets to benefit from the exchange rate.
Japanese holdings fell to $1.218 trillion in April, from $1.232 trillion in March.
Japan remained the largest non-U.S. holder of Treasuries.
Overall, foreign holdings of Treasuries slid to 7.455 trillion, the lowest since April 2021, from $7.613 trillion in March.
On a transaction basis, U.S. Treasuries saw net foreign outflows of $1.152 billion in April, from net new foreign inflows of $48.795 billion in March.
This was the first outflow since October 2021.
The Federal Reserve, at its policy meeting in March, raised benchmark interest rates by a quarter of a percentage point.
It lifted rates by 50 bps in May, but at the June policy meeting on Wednesday lifted rates by a hefty 75 bps to stem a disruptive surge in inflation.
The Fed also projected a slowing economy and rising unemployment in the months to come.
In other asset classes, foreigners sold U.S. equities in April amounting to $7.1 billion, from net outflows of $94.338 billion in March, the largest since at least January 1978, when the Treasury Department started keeping track of this data.
Foreign investors have sold stocks for four consecutive months.
U.S. corporate bonds, on the other hand, posted inflows in April of $22.587 billion, from March’s $33.38 billion, the largest since March 2021.
Foreigners were net buyers of U.S. corporate bonds for four straight months.
U.S. residents, meanwhile, decreased their holdings of long-term foreign securities, with net sales of $36.7 billion, data showed.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Paul Simao and Richard Pullin
https://www.reuters.com/article/usa-tre ... SL1N2Y23CF
Japan
Re: Japan
REUTERS
"Japan, China cut holdings of U.S. Treasuries to multi-year lows - data"
By Gertrude Chavez-Dreyfuss
JULY 18, 2022
NEW YORK (Reuters) - Japan and China pared back holdings of U.S. Treasuries in May to multi-year lows, data from the U.S. Treasury department showed on Monday.
Japan’s holdings fell to $1.212 trillion, the lowest since January 2020, when the country’s stash of Treasuries was $1.211 trillion.
In April, Japan’s holdings were at $1.218 trillion.
China’s hoard of U.S. government debt dropped as well to $980.8 billion in May, still the lowest since May 2010 when its holdings were at $843.7 billion, data showed.
In April, China had $1.003 trillion in Treasuries.
The world’s second largest economy has reduced holdings Treasuries for six straight months.
Although China and Japan sold Treasuries in May, U.S. Treasury yields slid.
The benchmark 10-year Treasury yield started the month of May at 2.996%, down about 15 basis points to 2.844% by the end of the month.
Overall, foreign holdings of Treasuries slid to $7.421 trillion in May, the lowest since May 2021, from $7.455 trillion in April.
“It’s another month of selling by foreign investors."
"But it seems like the selling is starting to slow because in May, the move higher in interest rates faded a little bit,” said Gennadiy Goldberg, senior rates strategist at TD Securities in New York.
“Japan and China were selling which is real a continuation of recent trends."
"We got another month of selling from Japan, but if you look at the pace, there was certainly a deceleration."
"Nothing like we saw in March at the end of Japan’s fiscal year.”
On a transaction basis, U.S. Treasuries saw net foreign inflows of $99.84 billion in May, the largest since March 2021, from outflows of $1.153 billion in April.
The Federal Reserve raised benchmark interest rates by 50 basis points in May and in June lifted rates by a hefty 75 basis points to curb stubbornly strong inflation.
Investors have priced in another 75 basis point rate hike at the Fed meeting later this month.
In other asset classes, foreigners sold U.S. equities in May for a fifth straight month amounting to $9.15 billion, from outflows of $7.04 billion in April.
The S&P 500 has been down nearly 20% since the beginning of the year.
U.S. corporate bonds posted inflows in May of $4.46 billion, compared with inflows of $22.5 billion the previous month.
Foreigners were net buyers of U.S. corporate bonds for five straight months.
The data also showed U.S. residents once again reduced their holdings of long-term foreign securities, with net sales of $22.8 billion in May from sales of $36.7 billion in April.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Jonathan Oatis and Sam Holmes
https://www.reuters.com/article/usa-tre ... SL1N2YZ23Q
"Japan, China cut holdings of U.S. Treasuries to multi-year lows - data"
By Gertrude Chavez-Dreyfuss
JULY 18, 2022
NEW YORK (Reuters) - Japan and China pared back holdings of U.S. Treasuries in May to multi-year lows, data from the U.S. Treasury department showed on Monday.
Japan’s holdings fell to $1.212 trillion, the lowest since January 2020, when the country’s stash of Treasuries was $1.211 trillion.
In April, Japan’s holdings were at $1.218 trillion.
China’s hoard of U.S. government debt dropped as well to $980.8 billion in May, still the lowest since May 2010 when its holdings were at $843.7 billion, data showed.
In April, China had $1.003 trillion in Treasuries.
The world’s second largest economy has reduced holdings Treasuries for six straight months.
Although China and Japan sold Treasuries in May, U.S. Treasury yields slid.
The benchmark 10-year Treasury yield started the month of May at 2.996%, down about 15 basis points to 2.844% by the end of the month.
Overall, foreign holdings of Treasuries slid to $7.421 trillion in May, the lowest since May 2021, from $7.455 trillion in April.
“It’s another month of selling by foreign investors."
"But it seems like the selling is starting to slow because in May, the move higher in interest rates faded a little bit,” said Gennadiy Goldberg, senior rates strategist at TD Securities in New York.
“Japan and China were selling which is real a continuation of recent trends."
"We got another month of selling from Japan, but if you look at the pace, there was certainly a deceleration."
"Nothing like we saw in March at the end of Japan’s fiscal year.”
On a transaction basis, U.S. Treasuries saw net foreign inflows of $99.84 billion in May, the largest since March 2021, from outflows of $1.153 billion in April.
The Federal Reserve raised benchmark interest rates by 50 basis points in May and in June lifted rates by a hefty 75 basis points to curb stubbornly strong inflation.
Investors have priced in another 75 basis point rate hike at the Fed meeting later this month.
In other asset classes, foreigners sold U.S. equities in May for a fifth straight month amounting to $9.15 billion, from outflows of $7.04 billion in April.
The S&P 500 has been down nearly 20% since the beginning of the year.
U.S. corporate bonds posted inflows in May of $4.46 billion, compared with inflows of $22.5 billion the previous month.
Foreigners were net buyers of U.S. corporate bonds for five straight months.
The data also showed U.S. residents once again reduced their holdings of long-term foreign securities, with net sales of $22.8 billion in May from sales of $36.7 billion in April.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Jonathan Oatis and Sam Holmes
https://www.reuters.com/article/usa-tre ... SL1N2YZ23Q
Re: Japan
REUTERS
"China cuts U.S. Treasuries holdings for 7th straight month - data"
By Reuters Staff
AUGUST 15, 2022
NEW YORK (Reuters) - China reduced holdings of U.S. Treasuries for a seventh consecutive month in June, U.S. Treasury department data released on Monday showed.
China’s stash of U.S. government debt dropped to $967.8 billion in June, the lowest since May 2010 when it held $843.7 billion.
In May, the world’s second largest economy had $980.8 billion in Treasuries, data showed.
Japan increased holdings of Treasuries to $1.236 trillion in June, from a revised $1.224 trillion in May.
The Treasury report released in July showed Japan had $1.213 trillion in Treasuries.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Richard Chang
https://www.reuters.com/article/usa-tre ... SL1N2ZR1MV
"China cuts U.S. Treasuries holdings for 7th straight month - data"
By Reuters Staff
AUGUST 15, 2022
NEW YORK (Reuters) - China reduced holdings of U.S. Treasuries for a seventh consecutive month in June, U.S. Treasury department data released on Monday showed.
China’s stash of U.S. government debt dropped to $967.8 billion in June, the lowest since May 2010 when it held $843.7 billion.
In May, the world’s second largest economy had $980.8 billion in Treasuries, data showed.
Japan increased holdings of Treasuries to $1.236 trillion in June, from a revised $1.224 trillion in May.
The Treasury report released in July showed Japan had $1.213 trillion in Treasuries.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Richard Chang
https://www.reuters.com/article/usa-tre ... SL1N2ZR1MV
Re: Japan
REUTERS
"UPDATE 1-China raises holdings of Treasuries in July, Japan cuts holdings - Treasury data"
By Reuters Staff
SEPTEMBER 16, 2022
NEW YORK, Sept 16 (Reuters) - China increased its holdings of Treasuries in July for the first time in eight months, while Japan reduced its U.S. government debt load, data from the U.S. Treasury department showed on Friday.
China’s stash of Treasuries rose to $970 billion in July, from $967.8 billion in June, which was the lowest since May 2010 when it had $843.7 billion.
Japan, on the other hand, reduced its Treasury debt holdings to $1.234 trillion in July from $1.236 trillion the previous month.
Japan remains the largest non-U.S. holder of Treasuries.
The fall in Japan’s holdings was more or less in line with moves in the currency market.
The yen firmed in July against the greenback, ending the month at 131.6 yen per dollar, from 135.22 yen at the beginning.
The yen’s steep fall against a resurgent dollar this year has raised the prospect of Japan intervening in the market to boost the Japanese currency.
Since the beginning of 2022, the yen has fallen 19.5% versus the dollar.
Overall, foreign holdings of Treasuries rose to $7.501 trillion in July, from 7.430 trillion in June.
On a transaction basis, U.S. Treasuries saw net foreign inflows of $23.12 billion in July, down from $58.9 billion the previous month.
U.S. Treasuries have posted foreign inflows for a third straight month.
The inflows generally tracked price action in the Treasuries market.
The benchmark 10-year Treasury yield started July at 2.904%, and ended the month at 2.642%.
In other asset classes, foreigners sold U.S. equities in July for a seventh straight month amounting to $60.32 billion, from outflows of $25.36 billion in June.
July’s outflow was the largest since March.
U.S. corporate bonds posted inflows in July of $8.78 billion, slightly down from $13.99 billion in June.
Foreigners were net buyers of U.S. corporate bonds for seven straight months.
The Treasury data also showed U.S. residents once again sold their holdings of long-term foreign securities, with net sales of $27.2 billion, from sales of $50.5 billion in June.
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Chris Reese and Jonathan Oatis)
https://www.reuters.com/article/usa-tre ... SL1N30N2YK
"UPDATE 1-China raises holdings of Treasuries in July, Japan cuts holdings - Treasury data"
By Reuters Staff
SEPTEMBER 16, 2022
NEW YORK, Sept 16 (Reuters) - China increased its holdings of Treasuries in July for the first time in eight months, while Japan reduced its U.S. government debt load, data from the U.S. Treasury department showed on Friday.
China’s stash of Treasuries rose to $970 billion in July, from $967.8 billion in June, which was the lowest since May 2010 when it had $843.7 billion.
Japan, on the other hand, reduced its Treasury debt holdings to $1.234 trillion in July from $1.236 trillion the previous month.
Japan remains the largest non-U.S. holder of Treasuries.
The fall in Japan’s holdings was more or less in line with moves in the currency market.
The yen firmed in July against the greenback, ending the month at 131.6 yen per dollar, from 135.22 yen at the beginning.
The yen’s steep fall against a resurgent dollar this year has raised the prospect of Japan intervening in the market to boost the Japanese currency.
Since the beginning of 2022, the yen has fallen 19.5% versus the dollar.
Overall, foreign holdings of Treasuries rose to $7.501 trillion in July, from 7.430 trillion in June.
On a transaction basis, U.S. Treasuries saw net foreign inflows of $23.12 billion in July, down from $58.9 billion the previous month.
U.S. Treasuries have posted foreign inflows for a third straight month.
The inflows generally tracked price action in the Treasuries market.
The benchmark 10-year Treasury yield started July at 2.904%, and ended the month at 2.642%.
In other asset classes, foreigners sold U.S. equities in July for a seventh straight month amounting to $60.32 billion, from outflows of $25.36 billion in June.
July’s outflow was the largest since March.
U.S. corporate bonds posted inflows in July of $8.78 billion, slightly down from $13.99 billion in June.
Foreigners were net buyers of U.S. corporate bonds for seven straight months.
The Treasury data also showed U.S. residents once again sold their holdings of long-term foreign securities, with net sales of $27.2 billion, from sales of $50.5 billion in June.
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Chris Reese and Jonathan Oatis)
https://www.reuters.com/article/usa-tre ... SL1N30N2YK
Re: Japan
REUTERS
"Japan warns of dire finances as BOJ struggles to contain yields"
By Tetsushi Kajimoto
January 23, 2023
Summary
* Japan's finances intensified severity to unprecedented point
* Rounds of extra budget, stimulus measures aggravate finances
* Public finance is the cornerstone of a country's trust - finmin
* Economic revival comes first before fiscal reform in long run
* Parliament debate begins, all eyes on new BOJ governor nominee
TOKYO, Jan 23 (Reuters) - Japan's finances are becoming increasingly precarious, Finance Minister Shunichi Suzuki warned on Monday, just as markets test whether the central bank can keep interest rates ultra-low, allowing the government to service its debt.
The government has been helped by near-zero bond yields, but bond investors have recently sought to break the Bank of Japan's 0.5% cap on the 10-year bond yield, as inflation runs at 41-year highs, double the central bank's 2% target.
"Japan's public finances have increased in severity to an unprecedented degree as we have compiled supplementary budgets to respond to the coronavirus and similar issues," Suzuki said in a policy speech starting a session of parliament.
It is not unusual for the finance minister to refer to Japan's strained finances.
Despite the country's growing debt pile, the government remains under pressure to keep the fiscal spigot wide open.
Japan must balance regional security concerns over China, Russia and North Korea, and manage a debt burden more than twice the size of its $5 trillion economy - by far the heaviest burden in the industrialised world.
Market showed little reaction to Suzuki's speech, in which he explained the details of the coming fiscal year's state budget worth a record 114.4 trillion yen ($878.9 billion).
Suzuki reiterated the government's aim to achieve an annual budget surplus - excluding new bond sales and debt-servicing costs - in the fiscal year to March 2026.
The government, however, has missed budget-balancing targets for a decade.
The Ministry of Finance estimates that every 1-percentage-point rise in interest rates would boost debt service by 3.7 trillion yen to 32.5 trillion yen for the 2025/2026 fiscal year.
"The government will strive to stably manage Japanese government bond (JGBs) issuance through close communication with the market," he said.
"Overall JGB issuance, including rolling over bonds, remain at an extremely high level worth about 206 trillion yen."
"We will step up efforts to keep JGB issuance stable."
"Public finance is the cornerstone of a country's trust."
"We must secure fiscal space under normal circumstances to safeguard trust in Japan and people's livelihood at a time of emergency."
LABOUR REFORM
Prime Minister Fumio Kishida echoed Suzuki's resolve to revive the economy and tackle fiscal reform.
He stressed the need for a positive cycle of growth led by corporate profits and private consumption, which accounts for more than half of the economy.
"Wage hikes hold the key to this virtuous cycle," Kishida said in his policy speech.
He vowed to push labour reform to create a structure that allows sustainable wage growth and overcome the pain of rising living costs.
"First of all, we need to realise wage growth that exceeds price increases," Kishida added, pledging to also boost childcare support, and push investment and reform in areas such as green and digital transformation.
Reporting by Tetsushi Kajimoto; Editing by William Mallard and Jacqueline Wong
https://www.reuters.com/markets/asia/ja ... 023-01-23/
"Japan warns of dire finances as BOJ struggles to contain yields"
By Tetsushi Kajimoto
January 23, 2023
Summary
* Japan's finances intensified severity to unprecedented point
* Rounds of extra budget, stimulus measures aggravate finances
* Public finance is the cornerstone of a country's trust - finmin
* Economic revival comes first before fiscal reform in long run
* Parliament debate begins, all eyes on new BOJ governor nominee
TOKYO, Jan 23 (Reuters) - Japan's finances are becoming increasingly precarious, Finance Minister Shunichi Suzuki warned on Monday, just as markets test whether the central bank can keep interest rates ultra-low, allowing the government to service its debt.
The government has been helped by near-zero bond yields, but bond investors have recently sought to break the Bank of Japan's 0.5% cap on the 10-year bond yield, as inflation runs at 41-year highs, double the central bank's 2% target.
"Japan's public finances have increased in severity to an unprecedented degree as we have compiled supplementary budgets to respond to the coronavirus and similar issues," Suzuki said in a policy speech starting a session of parliament.
It is not unusual for the finance minister to refer to Japan's strained finances.
Despite the country's growing debt pile, the government remains under pressure to keep the fiscal spigot wide open.
Japan must balance regional security concerns over China, Russia and North Korea, and manage a debt burden more than twice the size of its $5 trillion economy - by far the heaviest burden in the industrialised world.
Market showed little reaction to Suzuki's speech, in which he explained the details of the coming fiscal year's state budget worth a record 114.4 trillion yen ($878.9 billion).
Suzuki reiterated the government's aim to achieve an annual budget surplus - excluding new bond sales and debt-servicing costs - in the fiscal year to March 2026.
The government, however, has missed budget-balancing targets for a decade.
The Ministry of Finance estimates that every 1-percentage-point rise in interest rates would boost debt service by 3.7 trillion yen to 32.5 trillion yen for the 2025/2026 fiscal year.
"The government will strive to stably manage Japanese government bond (JGBs) issuance through close communication with the market," he said.
"Overall JGB issuance, including rolling over bonds, remain at an extremely high level worth about 206 trillion yen."
"We will step up efforts to keep JGB issuance stable."
"Public finance is the cornerstone of a country's trust."
"We must secure fiscal space under normal circumstances to safeguard trust in Japan and people's livelihood at a time of emergency."
LABOUR REFORM
Prime Minister Fumio Kishida echoed Suzuki's resolve to revive the economy and tackle fiscal reform.
He stressed the need for a positive cycle of growth led by corporate profits and private consumption, which accounts for more than half of the economy.
"Wage hikes hold the key to this virtuous cycle," Kishida said in his policy speech.
He vowed to push labour reform to create a structure that allows sustainable wage growth and overcome the pain of rising living costs.
"First of all, we need to realise wage growth that exceeds price increases," Kishida added, pledging to also boost childcare support, and push investment and reform in areas such as green and digital transformation.
Reporting by Tetsushi Kajimoto; Editing by William Mallard and Jacqueline Wong
https://www.reuters.com/markets/asia/ja ... 023-01-23/
Re: Japan
REUTERS
"Japan, Netherlands to join U.S. in restricting chip equipment exports to China, Bloomberg reports"
Reuters
January 27, 2023
TOKYO, Jan 27 (Reuters) - Japan and the Netherlands will soon agree to join the United States in restricting exports of semiconductor manufacturing equipment to China, Bloomberg News reported.
Talks between the countries will conclude as early as Friday, with the Netherlands restricting ASML Holding NV from selling machines to China used to make certain types of advanced chips, Bloomberg reported, citing people familiar with the matter.
Japan would impose similar restrictions on Nikon Corp, the report said.
Deputy Chief Cabinet Secretary Seiji Kihara, a government spokesperson, said Japan would make "appropriate steps" based on the United States' and other nations' regulatory moves.
He declined to comment further when asked about the report at a Friday afternoon media briefing.
The Dutch foreign ministry declined comment.
Prime Minister Mark Rutte, who has said he expects to reach agreement with the United States and other allies on stricter controls but that the Netherlands will not simply adopt U.S. rules, will take questions at his weekly news briefing later on Friday.
Sources have told Reuters that a deal between Dutch and U.S. officials could be clinched by the end of the month as representatives from the two countries meet in Washington on Friday.
Getting the Netherlands and Japan to impose tighter export controls on China would be a major diplomatic win for U.S. President Joe Biden's administration, which in October announced sweeping restrictions on Beijing's access to U.S. chipmaking technology to slow its technological and military advances.
Without Japanese or Dutch cooperation, U.S. companies would face a competitive disadvantage.
"We have been in discussion with the United States and other countries regarding the export-control regime," Yasutoshi Nishimura, Japan's Minister of Economy, Trade and Industry, told reporters on Friday.
"We will implement any measures in accordance with our Foreign Exchange Law and through international cooperation," he added, declining to provide further details.
While Nikon could be affected, the Japanese company most likely to be affected by new restrictions will be chip manufacturing machinery maker Tokyo Electron, which relies on China for about a quarter of its sales, said Masahiko Hosokawa, a Meisei University professor and former director general of trade control at the ministry.
"A balance needs to be struck so no one among Japan, the United States and Europe will be disproportionately disadvantaged."
"It's about fairness," he said.
Dutch officials have insisted that fresh controls address national security concerns rather than favour U.S. chip-related companies, a source familiar with the discussions told Reuters.
Japan expects sales at affected chip-related companies to rebound quickly because the market for their equipment is expanding, a trade and industry official involved in overseeing semiconductor firms told Reuters.
He asked not to be identified because he is not authorised to speak to the media.
Reporting by Tim Kelly, Kiysho Takenaka, Mayu Sakoda, Kantaro Komiya and Satoshi Sugiyama; Editing by Chang-Ran Kim, Gerry Doyle and Jacqueline Wong
https://www.reuters.com/technology/japa ... 023-01-27/
"Japan, Netherlands to join U.S. in restricting chip equipment exports to China, Bloomberg reports"
Reuters
January 27, 2023
TOKYO, Jan 27 (Reuters) - Japan and the Netherlands will soon agree to join the United States in restricting exports of semiconductor manufacturing equipment to China, Bloomberg News reported.
Talks between the countries will conclude as early as Friday, with the Netherlands restricting ASML Holding NV from selling machines to China used to make certain types of advanced chips, Bloomberg reported, citing people familiar with the matter.
Japan would impose similar restrictions on Nikon Corp, the report said.
Deputy Chief Cabinet Secretary Seiji Kihara, a government spokesperson, said Japan would make "appropriate steps" based on the United States' and other nations' regulatory moves.
He declined to comment further when asked about the report at a Friday afternoon media briefing.
The Dutch foreign ministry declined comment.
Prime Minister Mark Rutte, who has said he expects to reach agreement with the United States and other allies on stricter controls but that the Netherlands will not simply adopt U.S. rules, will take questions at his weekly news briefing later on Friday.
Sources have told Reuters that a deal between Dutch and U.S. officials could be clinched by the end of the month as representatives from the two countries meet in Washington on Friday.
Getting the Netherlands and Japan to impose tighter export controls on China would be a major diplomatic win for U.S. President Joe Biden's administration, which in October announced sweeping restrictions on Beijing's access to U.S. chipmaking technology to slow its technological and military advances.
Without Japanese or Dutch cooperation, U.S. companies would face a competitive disadvantage.
"We have been in discussion with the United States and other countries regarding the export-control regime," Yasutoshi Nishimura, Japan's Minister of Economy, Trade and Industry, told reporters on Friday.
"We will implement any measures in accordance with our Foreign Exchange Law and through international cooperation," he added, declining to provide further details.
While Nikon could be affected, the Japanese company most likely to be affected by new restrictions will be chip manufacturing machinery maker Tokyo Electron, which relies on China for about a quarter of its sales, said Masahiko Hosokawa, a Meisei University professor and former director general of trade control at the ministry.
"A balance needs to be struck so no one among Japan, the United States and Europe will be disproportionately disadvantaged."
"It's about fairness," he said.
Dutch officials have insisted that fresh controls address national security concerns rather than favour U.S. chip-related companies, a source familiar with the discussions told Reuters.
Japan expects sales at affected chip-related companies to rebound quickly because the market for their equipment is expanding, a trade and industry official involved in overseeing semiconductor firms told Reuters.
He asked not to be identified because he is not authorised to speak to the media.
Reporting by Tim Kelly, Kiysho Takenaka, Mayu Sakoda, Kantaro Komiya and Satoshi Sugiyama; Editing by Chang-Ran Kim, Gerry Doyle and Jacqueline Wong
https://www.reuters.com/technology/japa ... 023-01-27/
Re: Japan
REUTERS
"Japan may opt for milder chip-equipment curbs on China than U.S, says lawmaker"
By Kiyoshi Takenaka and Tim Kelly
February 8, 2023
TOKYO, Feb 8 (Reuters) - Japan may opt for milder restrictions on chip production machinery sales in China than those implemented by the United States even though they agree on export curbs, an influential Japanese ruling party lawmaker told Reuters on Wednesday.
Japan last month agreed with the Netherlands and the United States to halt exports of equipment that China could use to manufacture advanced chips, bringing Tokyo and Amsterdam in line with sweeping restrictions announced by U.S. President Joe Biden's administration in October.
"The United States is being strict, but there is a question of whether we have to exactly match that."
"What we do share is a recognition of the concern over the equipment," said Akira Amari, a former Liberal Democratic Party minister of economy trade and industry.
The U.S. wants to hobble Beijing's bid to dominate global chip production and stop it acquiring semiconductors that could enhance its military power.
Any difference in the separate restrictions that Tokyo, Washington and the Netherlands implement, could be a political headache for Biden if it makes U.S. equipment less competitive than those of its rivals.
SEMI, an industry group representing 2,500 members in the semiconductor and electronics manufacturing supply chain, this month also warned that export controls on China would not be effective unless U.S. allies adopt curbs in line with the United States.
Amari said he had been briefed by the Japanese government on the deal, which only the United states has so far publicly acknowledged.
He declined to give details, but said specifics of the agreement, including what machinery would be subject to restrictions, had yet to be hammered out in talks.
"Governments and companies concerned with the issue will have to dig into it, and find where the line needs to be drawn," said Amari.
Reporting by Kiyoshi Takenaka, Tim Kelly and Mayu Sakoda; Editing by Bernadette Baum
https://www.reuters.com/technology/japa ... 023-02-08/
"Japan may opt for milder chip-equipment curbs on China than U.S, says lawmaker"
By Kiyoshi Takenaka and Tim Kelly
February 8, 2023
TOKYO, Feb 8 (Reuters) - Japan may opt for milder restrictions on chip production machinery sales in China than those implemented by the United States even though they agree on export curbs, an influential Japanese ruling party lawmaker told Reuters on Wednesday.
Japan last month agreed with the Netherlands and the United States to halt exports of equipment that China could use to manufacture advanced chips, bringing Tokyo and Amsterdam in line with sweeping restrictions announced by U.S. President Joe Biden's administration in October.
"The United States is being strict, but there is a question of whether we have to exactly match that."
"What we do share is a recognition of the concern over the equipment," said Akira Amari, a former Liberal Democratic Party minister of economy trade and industry.
The U.S. wants to hobble Beijing's bid to dominate global chip production and stop it acquiring semiconductors that could enhance its military power.
Any difference in the separate restrictions that Tokyo, Washington and the Netherlands implement, could be a political headache for Biden if it makes U.S. equipment less competitive than those of its rivals.
SEMI, an industry group representing 2,500 members in the semiconductor and electronics manufacturing supply chain, this month also warned that export controls on China would not be effective unless U.S. allies adopt curbs in line with the United States.
Amari said he had been briefed by the Japanese government on the deal, which only the United states has so far publicly acknowledged.
He declined to give details, but said specifics of the agreement, including what machinery would be subject to restrictions, had yet to be hammered out in talks.
"Governments and companies concerned with the issue will have to dig into it, and find where the line needs to be drawn," said Amari.
Reporting by Kiyoshi Takenaka, Tim Kelly and Mayu Sakoda; Editing by Bernadette Baum
https://www.reuters.com/technology/japa ... 023-02-08/
Re: Japan
REUTERS
"UPDATE 1-Foreign holdings of US Treasuries rise for 3rd month in January as yields decline -data
By Gertrude Chavez-Dreyfuss
MARCH 15, 2023
NEW YORK, March 15 (Reuters) - Foreign holdings of U.S. Treasuries rose for a third straight month in January, data from the U.S. Treasury Department showed on Wednesday, with yields continuing their decline as investors reckoned that the Federal Reserve was nearing the end of its tightening cycle.
U.S. economic data during the month showed signs of slowing down as the Fed’s past rate increases started to take their toll on the economy.
Offshore holdings rose to $7.402 trillion in January from $7.318 trillion the previous month.
But compared with a year earlier, Treasuries held by foreigners fell 3.3% in January.
The benchmark 10-year Treasury yield started January at 3.792%, falling to 3.529% by the end of the month.
U.S. 10-year yields hit a 15-month high of 4.338% in October last year.
The decline in U.S. Treasury yields, which move inversely with prices, is a sign investors have started to dip their toes back into to the debt market.
The inflow into bonds also came after Treasuries notched the worst year in their history in 2022 following the Fed’s most aggressive monetary policy tightening since the 1980s.
Japan remains the largest non-U.S. holder of Treasuries with $1.104 trillion in January.
That was up from $1.076 trillion in December.
Japan though had been selling Treasuries for most of last year to help defend a struggling yen.
Data also showed holdings of China, the second biggest non-U.S. holder of Treasuries, fell once again to $859.4 billion, down from $867.1 billion in December.
China’s holdings fell for a sixth straight month and were the lowest since May 2010 when it had $843.7 billion.
Much like Japan last year, the world’s second largest economy has been unloading Treasuries to help boost its slumping currency, the yuan, against a robust dollar, which had benefited from a string of big interest rate hikes by the Fed.
On a transaction basis, Treasuries posted foreign inflows of $50.9 billion in January, from $19.98 billion in December.
Treasuries have seen inflows from foreign investors for nine straight months.
Data also showed outflows of $27.52 billion in U.S. stocks in January, compared with inflows of $54.98 billion the previous months.
Foreigners also bought $2.42 billion in U.S. corporate bonds, compared with $14.38 billion in December.
The sector has seen foreign inflows for 13 straight months.
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Mark Porter and Marguerita Choy)
https://www.reuters.com/article/usa-tre ... SL1N35N380
"UPDATE 1-Foreign holdings of US Treasuries rise for 3rd month in January as yields decline -data
By Gertrude Chavez-Dreyfuss
MARCH 15, 2023
NEW YORK, March 15 (Reuters) - Foreign holdings of U.S. Treasuries rose for a third straight month in January, data from the U.S. Treasury Department showed on Wednesday, with yields continuing their decline as investors reckoned that the Federal Reserve was nearing the end of its tightening cycle.
U.S. economic data during the month showed signs of slowing down as the Fed’s past rate increases started to take their toll on the economy.
Offshore holdings rose to $7.402 trillion in January from $7.318 trillion the previous month.
But compared with a year earlier, Treasuries held by foreigners fell 3.3% in January.
The benchmark 10-year Treasury yield started January at 3.792%, falling to 3.529% by the end of the month.
U.S. 10-year yields hit a 15-month high of 4.338% in October last year.
The decline in U.S. Treasury yields, which move inversely with prices, is a sign investors have started to dip their toes back into to the debt market.
The inflow into bonds also came after Treasuries notched the worst year in their history in 2022 following the Fed’s most aggressive monetary policy tightening since the 1980s.
Japan remains the largest non-U.S. holder of Treasuries with $1.104 trillion in January.
That was up from $1.076 trillion in December.
Japan though had been selling Treasuries for most of last year to help defend a struggling yen.
Data also showed holdings of China, the second biggest non-U.S. holder of Treasuries, fell once again to $859.4 billion, down from $867.1 billion in December.
China’s holdings fell for a sixth straight month and were the lowest since May 2010 when it had $843.7 billion.
Much like Japan last year, the world’s second largest economy has been unloading Treasuries to help boost its slumping currency, the yuan, against a robust dollar, which had benefited from a string of big interest rate hikes by the Fed.
On a transaction basis, Treasuries posted foreign inflows of $50.9 billion in January, from $19.98 billion in December.
Treasuries have seen inflows from foreign investors for nine straight months.
Data also showed outflows of $27.52 billion in U.S. stocks in January, compared with inflows of $54.98 billion the previous months.
Foreigners also bought $2.42 billion in U.S. corporate bonds, compared with $14.38 billion in December.
The sector has seen foreign inflows for 13 straight months.
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Mark Porter and Marguerita Choy)
https://www.reuters.com/article/usa-tre ... SL1N35N380
Re: Japan
REUTERS
"As Japan aligns with U.S. chip curbs on China, some in Tokyo feel uneasy"
By Tim Kelly, Karen Freifeld and Kentaro Sugiyama
July 24, 2023
TOKYO/NEW YORK, July 24 (Reuters) - Japan's imposition of export controls on chip making tools to align with a U.S. policy restricting China's ability to produce advanced semiconductors is worrying some officials in Tokyo who believe a combative U.S. approach may hamper coordination and needlessly provoke Beijing.
From this week, Japan is restricting 23 types of equipment, ranging from machines that deposit films on silicon wafers to devices that etch out the microscopic circuits of chips that could have military uses.
But, while the U.S. referenced China 20 times in its October announcement targeting Chinese companies, Japan has chosen broad equipment controls not specifically aimed at its bigger neighbour.
"We feel an odd discomfort with how the U.S. is doing this."
"There's no need to identify the country, all you need to do is control the item," a Japanese industry ministry official told Reuters.
Japan can't sanction countries unless they are involved in a conflict, the source added.
Japan's trade and industry minister told reporters when announcing Japan's measure in March that China was only one of 160 countries and regions that would be subject to controls and that Japan's rules were not meant to follow the U.S.
Even so, China has warned Japan to backdown.
Tokyo and Washington share concerns about China's push for advanced technologies and in May agreed with other Group of Seven industrial democracies on "de-risking" from potential Chinese economic coercion.
However, differences in chip making equipment controls could test that unity, should either gain a competitive advantage over the other by allowing exports the other blocked.
"Each country is responsible for its own licensing policies, and on top of that it's up to each country to enforce the licensing decisions that it undertakes," said Emily Benson, the director of the trade and technology project at the bipartisan nonprofit Center for Strategic and International Studies in Washington.
Japan is not applying a U.S. standard of presumption of denial and will allow exports whenever possible, a second Japanese government official said.
The Japanese government sources asked to remain anonymous because of the sensitivity of the issue.
There may also be underlying tensions because unlike Japan and the Netherlands, which will implement controls starting September, the U.S. is not limiting restrictions to specific tools.
"The U.S. rules still restrict other items and services the others do not," said Washington trade lawyer Kevin Wolf.
Reuters contacted six chip tool makers in Japan.
Two of them, deposition machinery maker Kokusai Electric and Japan's leading chip tool maker Tokyo Electron, said they expect Japan's controls to have a limited business impact.
Chip tester company Advantest Corp said none of its products are affected.
Lithography machine makers Nikon Corp and Canon Inc, and wafer cleaner manufacturer Screen Holdings did not respond.
COORDINATION
Dovetailing Japan's controls with those of the U.S. and the Netherlands will require close coordination.
"The issue in all these things is, what is it you can let go safely and what do you need to block."
"Everyone draws the line a little bit differently," said Jim Lewis, a former U.S. State Department and Commerce Department official, and a researcher at the Center for Strategic and International Studies (CSIS).
He has met with Japanese trade officials and believes Tokyo is committed to curbing certain exports.
Tokyo, Amsterdam and Washington have all indicated they would like chip tools added to a list of weapons, dual-use goods and technologies controlled by the 42 nations that are party to the Wassenaar Arrangement established after the Cold War.
They are unlikely, however, to win the unanimous backing they need from its members.
"The Wassenaar arrangement is next to hopeless because Russia's a member," said Lewis.
"You're never going to start by getting universal consensus."
"So, pick the guys who care and get them to work together."
The alternative is to form a closer group with the U.S. and the Netherlands to oversee chip manufacturing tools that could eventually include other countries, the first Japanese industry ministry official said.
The U.S. Commerce Department and Dutch government declined to comment.
The White House did not respond to a request for comment.
BROADER RESTRICTIONS
In the meantime, U.S. President Joe Biden's administration is expected to update its October rules, in part to align with the broader Japanese tool list.
It could also go further than the Netherlands in limiting what Dutch lithography manufacturer ASML can supply to certain Chinese plants, Reuters exclusively reported last month.
The U.S. can regulate ASML directly as its equipment includes U.S. parts.
At the time, sources expected the updates in July, but that now appears unlikely.
"Part of the reason it's taking so long is that the U.S. is still talking to Japan."
"They need to make sure that if they block anything, that they similarly block it in Japan," said a source familiar with the discussion.
Tokyo remains worried that targeting China will provoke damaging retaliation, such as a ban on Japanese electric cars, a third Japanese industry official said.
"What advantage is there to making someone lose face, unless that is your objective."
Reporting by Tim Kelly Karen Freifeld, Kentaro Sugiyama; additional reporting by Toby Sterling and Yoshifumi Takemoto; Editing by Lincoln Feast
https://www.reuters.com/technology/spac ... 023-07-24/
"As Japan aligns with U.S. chip curbs on China, some in Tokyo feel uneasy"
By Tim Kelly, Karen Freifeld and Kentaro Sugiyama
July 24, 2023
TOKYO/NEW YORK, July 24 (Reuters) - Japan's imposition of export controls on chip making tools to align with a U.S. policy restricting China's ability to produce advanced semiconductors is worrying some officials in Tokyo who believe a combative U.S. approach may hamper coordination and needlessly provoke Beijing.
From this week, Japan is restricting 23 types of equipment, ranging from machines that deposit films on silicon wafers to devices that etch out the microscopic circuits of chips that could have military uses.
But, while the U.S. referenced China 20 times in its October announcement targeting Chinese companies, Japan has chosen broad equipment controls not specifically aimed at its bigger neighbour.
"We feel an odd discomfort with how the U.S. is doing this."
"There's no need to identify the country, all you need to do is control the item," a Japanese industry ministry official told Reuters.
Japan can't sanction countries unless they are involved in a conflict, the source added.
Japan's trade and industry minister told reporters when announcing Japan's measure in March that China was only one of 160 countries and regions that would be subject to controls and that Japan's rules were not meant to follow the U.S.
Even so, China has warned Japan to backdown.
Tokyo and Washington share concerns about China's push for advanced technologies and in May agreed with other Group of Seven industrial democracies on "de-risking" from potential Chinese economic coercion.
However, differences in chip making equipment controls could test that unity, should either gain a competitive advantage over the other by allowing exports the other blocked.
"Each country is responsible for its own licensing policies, and on top of that it's up to each country to enforce the licensing decisions that it undertakes," said Emily Benson, the director of the trade and technology project at the bipartisan nonprofit Center for Strategic and International Studies in Washington.
Japan is not applying a U.S. standard of presumption of denial and will allow exports whenever possible, a second Japanese government official said.
The Japanese government sources asked to remain anonymous because of the sensitivity of the issue.
There may also be underlying tensions because unlike Japan and the Netherlands, which will implement controls starting September, the U.S. is not limiting restrictions to specific tools.
"The U.S. rules still restrict other items and services the others do not," said Washington trade lawyer Kevin Wolf.
Reuters contacted six chip tool makers in Japan.
Two of them, deposition machinery maker Kokusai Electric and Japan's leading chip tool maker Tokyo Electron, said they expect Japan's controls to have a limited business impact.
Chip tester company Advantest Corp said none of its products are affected.
Lithography machine makers Nikon Corp and Canon Inc, and wafer cleaner manufacturer Screen Holdings did not respond.
COORDINATION
Dovetailing Japan's controls with those of the U.S. and the Netherlands will require close coordination.
"The issue in all these things is, what is it you can let go safely and what do you need to block."
"Everyone draws the line a little bit differently," said Jim Lewis, a former U.S. State Department and Commerce Department official, and a researcher at the Center for Strategic and International Studies (CSIS).
He has met with Japanese trade officials and believes Tokyo is committed to curbing certain exports.
Tokyo, Amsterdam and Washington have all indicated they would like chip tools added to a list of weapons, dual-use goods and technologies controlled by the 42 nations that are party to the Wassenaar Arrangement established after the Cold War.
They are unlikely, however, to win the unanimous backing they need from its members.
"The Wassenaar arrangement is next to hopeless because Russia's a member," said Lewis.
"You're never going to start by getting universal consensus."
"So, pick the guys who care and get them to work together."
The alternative is to form a closer group with the U.S. and the Netherlands to oversee chip manufacturing tools that could eventually include other countries, the first Japanese industry ministry official said.
The U.S. Commerce Department and Dutch government declined to comment.
The White House did not respond to a request for comment.
BROADER RESTRICTIONS
In the meantime, U.S. President Joe Biden's administration is expected to update its October rules, in part to align with the broader Japanese tool list.
It could also go further than the Netherlands in limiting what Dutch lithography manufacturer ASML can supply to certain Chinese plants, Reuters exclusively reported last month.
The U.S. can regulate ASML directly as its equipment includes U.S. parts.
At the time, sources expected the updates in July, but that now appears unlikely.
"Part of the reason it's taking so long is that the U.S. is still talking to Japan."
"They need to make sure that if they block anything, that they similarly block it in Japan," said a source familiar with the discussion.
Tokyo remains worried that targeting China will provoke damaging retaliation, such as a ban on Japanese electric cars, a third Japanese industry official said.
"What advantage is there to making someone lose face, unless that is your objective."
Reporting by Tim Kelly Karen Freifeld, Kentaro Sugiyama; additional reporting by Toby Sterling and Yoshifumi Takemoto; Editing by Lincoln Feast
https://www.reuters.com/technology/spac ... 023-07-24/
Re: Japan
REUTERS
"Foreign holdings of US Treasuries surge to all-time high in December - data"
By Gertrude Chavez-Dreyfuss
February 15, 2024
NEW YORK, Feb 15 (Reuters) - Foreign holdings of U.S. Treasuries soared to another all-time peak in December, data from the Treasury Department showed on Thursday, rising for a second straight month.
Holdings of U.S. Treasuries rose to $8.06 trillion in December, from what was then a record high of $7.808 trillion in November.
Compared with a year earlier, Treasuries held by foreigners expanded by 10.5%.
The increased buying of Treasuries continued a trend of the last few months, after yields dropped as the market priced in interest rate cuts by the Federal Reserve.
The three largest holders of Treasuries -- Japan, China and the UK -- led the purchase U.S. government debt.
Japanese investors raised their stash of Treasuries to $1.138 trillion in December, from $1.127 trillion in November, data showed.
Their holdings were the largest since August 2022.
Japan remains the largest non-U.S. holder of U.S. government debt.
China's holdings of Treasuries rose to $816.3 billion, up $34.3 billion from $782 billion held in November.
China's load of Treasuries rose for a second straight month.
Before that, China's Treasury holdings had declined for seven straight months.
In October last year, China's holding dropped to $763.5 billion, the lowest since March 2009.
The UK, meanwhile, listed its Treasury holdings at $753.7 billion in December, a record high.
The benchmark 10-year Treasury yield started November at 4.22%, ending the month at 3.86%, down 36 basis points.
The decline in yields coincided with the pivot by the Fed to a neutral stance from a tightening bias.
Data further showed that major U.S. asset classes showed inflows during the month.
On a transaction basis, U.S. Treasuries posted inflows of $33.8 billion, from a revised $72.4 billion in November.
U.S. equities showed inflows of $79.7 billion in December, sharply up from an outflow of $200 million in the previous month.
Foreign buying of U.S. corporates and agencies in November continued, with inflows of $23.8 billion and $4.6 billion, respectively.
Overall, net foreign acquisitions of long-term and short-term securities, as well as banking flows, showed a net inflow of $139.8 billion in December, down from a revised $223.3 billion posted in November, according to U.S. Treasury data.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Chris Reese and Jonathan Oatis
https://www.reuters.com/markets/foreign ... 024-02-15/
"Foreign holdings of US Treasuries surge to all-time high in December - data"
By Gertrude Chavez-Dreyfuss
February 15, 2024
NEW YORK, Feb 15 (Reuters) - Foreign holdings of U.S. Treasuries soared to another all-time peak in December, data from the Treasury Department showed on Thursday, rising for a second straight month.
Holdings of U.S. Treasuries rose to $8.06 trillion in December, from what was then a record high of $7.808 trillion in November.
Compared with a year earlier, Treasuries held by foreigners expanded by 10.5%.
The increased buying of Treasuries continued a trend of the last few months, after yields dropped as the market priced in interest rate cuts by the Federal Reserve.
The three largest holders of Treasuries -- Japan, China and the UK -- led the purchase U.S. government debt.
Japanese investors raised their stash of Treasuries to $1.138 trillion in December, from $1.127 trillion in November, data showed.
Their holdings were the largest since August 2022.
Japan remains the largest non-U.S. holder of U.S. government debt.
China's holdings of Treasuries rose to $816.3 billion, up $34.3 billion from $782 billion held in November.
China's load of Treasuries rose for a second straight month.
Before that, China's Treasury holdings had declined for seven straight months.
In October last year, China's holding dropped to $763.5 billion, the lowest since March 2009.
The UK, meanwhile, listed its Treasury holdings at $753.7 billion in December, a record high.
The benchmark 10-year Treasury yield started November at 4.22%, ending the month at 3.86%, down 36 basis points.
The decline in yields coincided with the pivot by the Fed to a neutral stance from a tightening bias.
Data further showed that major U.S. asset classes showed inflows during the month.
On a transaction basis, U.S. Treasuries posted inflows of $33.8 billion, from a revised $72.4 billion in November.
U.S. equities showed inflows of $79.7 billion in December, sharply up from an outflow of $200 million in the previous month.
Foreign buying of U.S. corporates and agencies in November continued, with inflows of $23.8 billion and $4.6 billion, respectively.
Overall, net foreign acquisitions of long-term and short-term securities, as well as banking flows, showed a net inflow of $139.8 billion in December, down from a revised $223.3 billion posted in November, according to U.S. Treasury data.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Chris Reese and Jonathan Oatis
https://www.reuters.com/markets/foreign ... 024-02-15/