Japan Intervenes to Prop Up Yen Amid Economic Pressures

Japan intervened in foreign exchange markets on Thursday, its first such move in three months, to prop up the yen as it neared four-decade lows. The intervention, conducted in New York, was a response to the currency's weakness, which has exacerbated living costs due to rocketing energy import prices.

The Bank of Japan (BOJ) is set to announce its policy decision on Friday, with markets expecting interest rates to remain steady at 1% but for the central bank to signal its readiness to continue pushing up borrowing costs. Finance Minister Satsuki Katayama declined to comment on the intervention but hinted at U.S. involvement in stemming the yen's decline.

U.S. Treasury Secretary Scott Bessent said Japan may have intervened, stating the yen 'seems very undervalued' to him. The Nikkei newspaper reported that Japan likely conducted massive yen-buying intervention, with U.S. authorities conducting rate checks. The New York Federal Reserve declined to comment.