US-Japan Intervention Boosts Yen After Months of Coordination
The US and Japan have jointly intervened in the foreign exchange market to support the yen, which has been under pressure due to its weakness. The intervention was the culmination of months of coordination between the two governments, with shared interests in exchange rate stability driving their close co-operation.
US Treasury Secretary Scott Bessent's public backing for a stronger yen gave Japan fresh ammunition to counter speculative pressure on the currency. For Japan, a weaker yen has driven up import prices and eroded household purchasing power, creating a challenge for Prime Minister Sanae Takaichi's administration.
The US government also had an interest in stabilizing the yen, as an excessively weak yen undermines the effectiveness of President Donald Trump's import tariffs. Additionally, volatility in Japan's bond market has raised concerns that it could push up US Treasury yields.