— BOJ: +0.3% In Household Assets Marks 3rd Straight Y/Y Rise
— BOJ: End-June Household JGB Holdings -3.3% Y/Y At Y34.38 Trln
— BOJ: Household JGB Holdings Mark 4th Straight Quarter of Y/Y Drop
— BOJ: Non-Japanese JGB Holdings Y51.6 Trln, -7.9% Y/Y
— BOJ: Household Cash, Deposits Up 1.3% At Y806.5 Trln

TOKYO (MNI) – The value of financial assets held by Japanese
households rose 0.3% on the year to Y1,445.0 trillion at the end of
June, but fell from the balance of Y1,457.1 trillion at the end of
March, preliminary data released by the Bank of Japan on Friday showed.

The 0.3% rise was the third consecutive y/y rise following a
revised 3.4% rise at the end of March.

The rise in the financial assets held by households was due to the
increase of cash and deposits, according to the data.

In the April-June quarter the total average monthly cash earnings
per regular employee in Japan rose 1.3% from a year earlier, the first
y/y gain in nine quarters since +0.8% in January-March 2008 and the
largest increase in about 13 years since +1.5% in July-September 1997.

The overall wage level was pushed up by overtime and summer bonuses
in the second quarter of this year, with overtime pay showing +12.0% y/y
and special cash earnings including bonuses +4.9%, recovering from sharp
drops seen a year before.

The BOJ’s preliminary flow of funds data suggested that personal
spending is likely to remain solid for the coming months, partly due to
the recent rise in the value of financial assets held by households.

The BOJ in its monthly economic report for September said:
“Private consumption is expected to remain on a recovery trend, despite
a likely temporary weakening mainly due to the ending of the boost from
the extremely hot weather and the abolition of subsidies for purchasing
energy efficient cars.”

The value of cash and deposits held by households at the end of
June rose 1.3% on year to Y806.5 trillion, marking the 14th consecutive
quarter of y/y gains, after rising 1.5% at the end of March, the data
showed.

The data indicated that households stayed away from risky asset
holdings during the second quarter and shifted money to safer assets.
The Tokyo stock market began to slide in May.

The value of shares and other equities held by Japanese households
at the end of June fell 4.1% year on year to Y95.0 trillion, reversing
from a revised 28.7% rise three months earlier and marking the first
on-year drop in three quarters, the data showed.

The value of investment trusts at the end of June was down 0.5% y/y
at Y49.7 trillion, also reversing from an unrevised 15.6% rise at the
end of March and marking the first y/y drop in three quarters.

The outstanding balance of Japanese government bonds held by
households at the end of June was down 3.3% from a year earlier at Y34.4
trillion, posting the fourth consecutive y/y drop, with the pace of
decline slowing from a 4.5% fall at the end of March.

The outstanding balance of JGBs held by domestic financial
institutions at the end of June totaled Y579 trillion, up 8.8% from a
year earlier.

The balance of JGBs held by financial institutions accounted for
67% of the total of JGBs at the end of June, little changed from a
record high level of 68% marked three months earlier.

The data also showed that the outstanding balance of Japanese
government debt including short-term paper held by non-residents at the
end of June totaled Y51.6 trillion, down 7.9% from a year earlier and
slowing from a 16.4% fall at the end of March.

JGB holdings by non-residents at the end of June accounted for 5.9%
of the total JGB balance of Y869 trillion, up from 5.7% at the end of
March.

The value of foreign currency denominated bonds held by Japanese
households at the end of June totaled Y8.1 trillion, up 14.7% from a
year earlier but down sharply from a revised 47.0% rise at the end of
March.

Meanwhile, the balance of foreign currency denominated deposits
held by the households at the end of June was at Y5.2 trillion, down
0.2% from a year earlier and reversing from an unrevised 2.0% rise three
months before and marking the first on-year drop in 10 quarters.

The balance of financial liabilities held by the Japanese
government was at Y1,035.2 trillion, up 6.3% from a year earlier.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4833 **

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