Treasury Warns Banks of Potential Yen Intervention Ahead of Friday's Action

The US Treasury has informed banks that it may intervene in Japan's yen market on Friday, according to a source familiar with the matter.

The notice was channeled through the Federal Reserve Bank of New York and advised banks to 'stand ready for future action.'

This comes after Japanese authorities stepped in to prop up the yen, causing it to rise against the dollar on Friday. The currency last traded at 159.09 to the dollar.

The method of potential Treasury intervention was not immediately clear, but the Federal Reserve has maintained a dollar liquidity swap line with major central banks since 2013.