March 31 in Tokyo: The Fiscal Year-End and Yen Pairs

[Shadow Trader]

Japan's corporate and government fiscal year runs from April to March, so the final weeks of March carry a distinct flavour for yen pairs. Companies close their books, banks tidy balance sheets, and treasury desks decide whether overseas earnings are converted into yen before accounts are struck.

The common narrative is that repatriation produces yen buying into the year-end. The evidence is mixed. Large exporters often hedge well in advance, so much of the conversion is already embedded in forward prices long before the date. Some years show yen strength into late March, while other years show the opposite, driven by rate expectations or risk sentiment that overwhelms any calendar effect.

The start of April matters as well. New fiscal year allocations by institutional investors, including decisions about foreign bond and equity holdings, can shift flows, though timing and size are rarely public. Liquidity around the Tokyo close can also thin as desks stay cautious about balance sheet usage.

For a scalper, the practical lesson concerns conditions rather than direction. Spreads and slippage in yen crosses can behave differently in the last days of March, so execution logs from earlier years are a better guide than folklore about which way price should travel.