US-Japan Currency Intervention Boosts Korean Won, Sparks Criticism from China

South Korea has remained tight-lipped about the US-Japan currency intervention, despite its benefits to the Korean won. The intervention, confirmed on August 3, aimed to support the yen, but it ultimately had a stronger effect on the won.

The won appreciated by 1.45% between July 29 and August 5, outperforming the yen's 3.67% gain during the same period. However, after the joint intervention on July 31, the situation reversed, with the won strengthening while the yen remained little changed.

Chinese officials have criticized the intervention, calling it a self-serving deal that will not alter the yen's long-term decline. They argue that the operation is driven by US economic interests and will primarily benefit American manufacturers and Treasury market.