US Pledges Continued Support for Yen Amid Joint Intervention Efforts

Treasury Secretary Scott Bessent reaffirmed US support for Japan's efforts to stabilize the yen after joint intervention in currency markets last week. The US Treasury and Japanese authorities have been working together to address Japan's inflation problem, which has been exacerbated by the yen's weakness.

Bessent emphasized that the US will continue to support Japan's efforts 'in a way that helps the American economy, the American taxpayer.' He noted that the yen's decline has increased the cost of imported goods for Japan, including energy. Bessent also warned that further decline could put pressure on other Asian currencies and lead to competitive devaluations.

The joint intervention marked the first coordinated effort between the US Treasury and Japanese authorities since 2011. The operation involved purchasing yen using euros from US reserves, which were reallocated in this transaction. Bessent expressed confidence that Prime Minister Sanae Takaichi's government will pursue greater budget discipline and that Bank of Japan Governor Kazuo Ueda will take necessary steps.