US-Japan Currency Intervention Falls Flat as Yen Continues to Weaken
The recent US-Japan coordinated currency market intervention has been met with criticism in Japan, with some calling it a 'monetary defeat'. The move was aimed at propping up the yen's value, which had fallen to around 160 per dollar. However, despite the intervention, the yen's value has since slipped back.
The Japanese government had repeatedly tried to stem the yen's weakness through market intervention but found its efforts insufficient. It ultimately turned to Washington for a joint response, with US President Donald Trump stating that Japan asked for help and viewed the intervention as a 'deal'.
US Treasury Secretary Scott Bessent emphasized that the yen would weaken again if Japan did not change its macroeconomic policies. He pointed out that Asian currencies track the yen closely, and a sharp decline could trigger financial instability across Asia and increased volatility in the US government bond market.