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U.S. and Japan Act to Support Yen After Sharp Decline

The moves signal U.S. backing for Tokyo's effort to arrest a rapid yen slide.

Image
A Japanese yen note is seen in this illustration photo taken June 1, 2017. REUTERS/Thomas White/Illustration/File Photo
U.S. Treasury Secretary Scott Bessent waves to members of the media at the White House in Washington, D.C., U.S., July 30, 2026. REUTERS/Kylie Cooper
A notepad in front of U.S. Secretary of the Treasury Scott Bessent reads "To Do Buy Japanese Yen $5-10 bil" as he participates in a cabinet meeting at Camp David, Maryland, U.S., July 31, 2026. The note, photographed at 11:33 EDT, came after Reuters earlier reported the Treasury had put banks on alert for a possible U.S. intervention in the market for Japan's currency. REUTERS/Daniel Heuer

Overview

  • Japanese authorities carried out large yen-buying operations to stop the currency's fall, with central bank data showing about $58.97 billion of dollar sales to buy yen on Thursday.
  • Reporting shows the U.S. Treasury prepared banks to 'stand ready' and that the New York Fed sold euros to buy yen for the Treasury through Goldman Sachs and Morgan Stanley, actions that helped push the yen higher on Friday.
  • A Reuters photograph taken at a Camp David Cabinet meeting showed Treasury Secretary Scott Bessent's notepad reading 'To Do Buy Japanese Yen (JPY) $5-10 bil.', though U.S. officials have not publicly confirmed purchase amounts.
  • Market data recorded a clear intraday yen jump—LSEG showed the dollar move from about ¥158.9 to ¥157.6 in late afternoon trading—and the rally later partially reversed, underscoring that such operations can produce only short-term moves without policy shifts.
  • The action, if confirmed as joint operations, would be the first direct U.S. support for the yen since 2011 and comes after the BOJ raised its policy rate to 1% in June, a change that and narrower rate gaps have altered carry-trade flows and increased pressure on the currency.