TOKYO, March 26 (Reuters) - Japanese Finance Minister Kaoru Yosano said on Wednesday that Japan does not plan to change its policy of investing a majority of its foreign reserves in U.S. Treasuries. Yosano also told the lower house financial committee that the Japanese government does not have any room for taking extraordinary steps in purchases of U.S. Treasuries.
His remark comes amid rising concerns that record government spending in the United States and large liquidity injections by the U.S. Federal reserve will create a global glut of dollars and shake the dollar's status as the world's main reserve currency. Yosano also said he does not think it was appropriate to sell part of Japan's foreign reserve assets in the market.
"Under the current situation, I do not think selling foreign reserves in the market is not appropriate as it would could cause unexpected movements in the currency markets," he said.
He was answering questions from a lawmaker of the main opposition Democratic Party of Japan, who urged the government to reconsider the amount of foreign reserves it holds from the view point of its exposure to exchange rate changes.
Japan's official foreign reserves stood at $1.009 trillion at the end of February, the second-largest in the world after China, government data showed earlier this month. (Reporting by Yuzo Saeki)