US and Japan Intervene in Forex Market to Support Yen
Japanese Finance Minister Satsuki Katayama confirmed that Japan and the United States had jointly intervened in the foreign exchange market to support the yen, stating they would not hesitate to intervene again if necessary.
US Treasury Secretary Scott Bessent revealed the reasoning behind the intervention, saying a stable yen is important for both countries because 'if the yen were to weaken substantially, then the other currencies would follow it.'
Some analysts believe the intervention may provide only short-term support due to Japan's expansionary fiscal policy and constraints on further interest-rate hikes.
Others speculate that US involvement could be motivated by a desire to stabilize or appreciate the yen in order to reduce selling pressure on US government debt, as Japan is one of the largest foreign holders of US Treasuries.