Japan and US Join Forces to Bolster Yen Amidst Global Economic Turmoil

The yen's weakness has become a pressing issue for Japan's policymakers due to its role in driving up import prices and household living costs. The resulting inflation has contributed to the downfall of two prime ministers before current leader Sanae Takaichi took office.

Japanese authorities spent almost US$74 billion in late April to support the currency following two months of steep declines, but the rebound was short-lived. By July 23, the yen had slid further to its weakest against the dollar since 1986.

The joint Japanese-US effort to bolster the yen marked one of the most dramatic interventions in global currency markets in decades. The US move signalled a shift in tone from Washington, with President Donald Trump saying the currency-market intervention was a sign of friendship with Tokyo.