US Intervenes in Yen Market for First Time Since 2011

The US Treasury Department has intervened in Japan's currency market to prop up the Japanese yen, which had reached a 40-year low against the dollar. President Donald Trump described the move as 'a signal of friendship' and said it was done at Japan's request.

According to the Financial Times, the Federal Reserve Bank of New York sold euros for yen on behalf of the Treasury Department in an effort to reverse the weakening of the yen. The intervention is significant because a weak yen makes imports such as oil and gas more expensive for Japan, fueling inflation.

Treasury Secretary Scott Bessent noted that the Treasury Department 'will not hesitate to participate in further joint intervention' if needed. Analysts are skeptical about the impact of this move, however, with some saying it may only provide temporary relief from the yen's downward pressure.