Tokyo and Washington Unite to Stem Yen's Slide Against Dollar

Japan and the United States have taken joint action in the currency market to stabilize the yen's slide against the dollar. Japanese Finance Minister Satsuki Katayama will announce on Monday that Tokyo and Washington worked together to arrest the yen's decline to 40-year lows.

The two countries' intervention is a first since 2011, with the goal of boosting the yen from its lowest levels against the dollar since 1986. The Japanese government conducted yen-buying, dollar-selling intervention in New York hours on Thursday, and the Bank of Japan signaled a strong chance of an early interest rate hike.

Treasury Secretary Scott Bessent had previously said that the yen 'seems very undervalued to me', and he was seen with a notepad at a cabinet meeting with the words 'To Do' followed by 'Buy Japanese Yen (JPY) $5-10 bil'. The Treasury also informed banks of potential intervention in the yen market, advising them to be prepared for future action.

The operation is still ongoing, and its success will depend on various factors. However, this joint effort between Tokyo and Washington marks a significant development in currency markets and may have implications for global economic stability.