US Treasury Clarifies Role in Japan's $97 Billion Yen Rescue

Treasury Secretary Scott Bessent has clarified how the US helped Japan pull off a $97 billion yen rescue in August. According to Bessent, the United States did not lend Japan any money but instead bought yen to stabilize its currency.

The Exchange Stabilization Fund, which is a Treasury reserve that can be tapped without Congressional approval, held $14.19 billion in euros and $2.57 billion in yen on June 30.

The fund's foreign cash only comes in two currencies: euros and yen. Therefore, the US sold euros for yen, resulting in an asset swap rather than a loan that would create a debt.

Japan published its total yen intervention figure on Friday, showing that it reached 15.4 trillion yen between July 30 and August 26.