Overview
- U.S. Treasury Secretary Scott Bessent and Japan’s Ministry of Finance confirmed that the two countries carried out coordinated foreign-exchange operations on Friday to support the yen.
- Bank of Japan account data and market reporting indicate Japan bought roughly ¥8.45 trillion (about $59 billion) of yen while the New York Fed reportedly bought yen for the Treasury, selling euros through banks including Goldman Sachs and Morgan Stanley.
- A Reuters photograph of Bessent’s notepad reading “Buy Japanese Yen (JPY) $5-10 bil” and Treasury messages telling banks to stand ready show Washington’s direct operational and preparatory role in the action.
- Markets reacted sharply with the dollar falling from near ¥164 earlier in the week to about ¥157–158 after the operations, and officials highlighted use of the Fed’s FIMA repo facility as a dollar-liquidity backstop.
- The authorities paired intervention with a clearer BOJ signal of an early rate increase because lasting yen stabilisation likely requires a narrower interest-rate gap; failure to narrow that gap risks renewed yen pressure and ripple effects for Japanese import costs and global bond markets.