Dollar Plunges as US and Japan Intervene in Markets

The US dollar has dropped sharply against the Japanese yen after both countries confirmed that they intervened in markets to counter excessive volatility. The intervention was suspected earlier last week, but it wasn't until President Donald Trump and Japan's Finance Minister Satsuki Katayama made official statements that the market reacted.

Before the announcement, the dollar was trading above 163 yen, a 40-year high. However, after regulators stepped in, it fell below 160 yen. The dollar dropped by about 1% to 156.34 yen immediately following the confirmation of intervention.

Japan has been trying to raise the value of its currency against the dollar for some time now, as a weak yen pushes up import prices and increases inflation. Trump said that the US got 'financial benefit' from the intervention, calling it a 'signal of friendship'. He also stated that it's good for the world economy.