US and Japan Stage Rare Joint Intervention to Support Yen
The US and Japan have jointly intervened in the foreign exchange market to support the yen for the first time since 2011. The intervention came after the yen hit its lowest level in four decades, weakening due to a gap between interest rates in Japan and the US.
The so-called 'carry trade', where investors borrow funds at low interest rates and invest them in higher-yielding assets, has also contributed to the yen's decline. Additionally, concerns over Japan's massive debt under new Prime Minister Sanae Takaichi have added to the pressure on the currency.
US President Donald Trump confirmed the coordinated intervention aboard Air Force One, describing it as a 'signal of friendship' with Japan and saying it was 'good for the world economy'. He also noted that the US would not hesitate to participate in further joint interventions if needed.