Bessent Warns Disorderly Yen Markets Could Fuel Higher US Interest Rates

Treasury Secretary Scott Bessent defended his decision to support the yen last month, saying that extreme volatility in the Japanese currency could have far-reaching consequences for US interest rates.

Bessent responded to a recent inquiry from Democratic Senator Elizabeth Warren, stating that Japan's significant holdings of US Treasuries make it a key player in global markets. He warned that disorderly yen markets can trigger forced unwinds, which could destabilize global markets and raise borrowing costs for American families and businesses.

Bessent emphasized the importance of maintaining stable financial systems, highlighting the potential consequences of extreme market fluctuations.