Bessent Vows US Support for Japan's Currency Stabilization Efforts

US Treasury Secretary Scott Bessent has pledged to support Japan's efforts to stabilize its currency, saying 'we will do whatever it takes' to help.

Bessent made the comments on CNBC two days after confirming that the US had joined Japan in a joint intervention last week to prop up the yen.

The Treasury chief cited concerns about the yen's substantial undervaluation, which could lead to other economic problems or competitive devaluations of other currencies 'which is unhealthy'. He noted that the FIMA facility, established during the COVID-19 era, allows key central banks to borrow up to $60 billion from the Federal Reserve to support their currencies.

Bessent acknowledged close contact with European partners, including central banks, regarding US sales of euros to buy yen. He emphasized that these transactions were simply a reallocation of reserves and did not imply any change in the euro's equilibrium price.