US Intervenes in Yen Market to Protect Asian Currencies

The recent intervention in the yen market by the U.S. and Japan has had an unexpected effect on other Asian currencies, including the South Korean won.

According to U.S. Treasury Secretary Scott Bessent, supporting the yen is not an act of generosity but one of self-interest, as a sharply weaker yen could trigger competitive devaluations across Asia, undermining U.S. exporters and global financial stability.

The intervention has helped stabilize the Korean won, which had fallen to multi-decades lows alongside the yen until June.

Bessent stated that an excessively weak yen contributed to the 1997-98 Asian financial crisis, and that a stable yen is crucial for the entire region.