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Trends in the Money Market in Japan*1

Results of the Tokyo Money Market Survey (August 2013)

  • *1This is an English translation of Japanese original released on December 26, 2013.

February 28, 2014
Financial Markets Department
Bank of Japan

Overview of the Tokyo Money Market Survey

The Survey

In August 2013, the Financial Markets Department of the Bank of Japan (the Bank) conducted the fourth Tokyo Money Market Survey (August 2013) to recognize developments in the Japanese money market.

Since 2008, this series of surveys had been conducted every other year until 2012. However, to better meet the needs of market participants and observe market trends more precisely, the Bank decided to conduct the survey annually beginning with the 2013 survey. At the same time, it reviewed the items contained in the survey to streamline the questions asked of respondents. The survey includes a full range of questions in even-numbered years, but in odd-numbered years -- as was in 2013 -- the Bank intends to reduce the scope of items surveyed, barring major changes in the market environment.

The survey is based on data including the amount outstanding in the call and repo markets as of the end of July 2013. All previous surveys were conducted as of end July.

The survey covers all eligible counterparties in the Bank's money market operations, as well as other major participants in the money market. The number of respondents in the survey increased from the previous survey, from 234 to 284. This reflects the rise in the number of eligible counterparties in the Bank's money market operations (from 211 to 261).

Overview of Results

Since the Bank's introduction in April 2013 of quantitative and qualitative monetary easing, the current account balances at the Bank have increased significantly. However, there were no significant changes in the amount outstanding in the money market, credit lines established for uncollateralized transactions, or the administrative structures of market participants in repo and call transactions.

It appears that the amount outstanding in the money market was underpinned by factors such as the following: (1) arbitrage transactions across the money market and the complementary deposit facility; (2) transactions among some market participants aimed at maintaining medium- and long-term relationships with counterparties; (3) an increase in lending by investment trusts reflecting the rise in stock prices; and (4) active repo transactions by non-residents.

In detail, the results of the survey showed that transactions expanded among financial institutions that were ineligible for the complementary deposit facility. It was also found that money market participants reviewed money market instruments, forms of contracts and the terms of their transactions.

Summaries of money market transactions by market and type of financial institutions are presented in the paper.


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Financial Markets Department, Bank of Japan
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Market Infrastructure Group, Market Infrastructure Division, Financial Markets Department

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