US Treasury Defends $97 Billion Yen Intervention Amid Repayment Risk Concerns

Treasury Secretary Scott Bessent defended Washington's intervention in the Japanese yen, arguing that it did not create a loan to Japan and therefore carries no repayment risk.

The dispute follows an Aug. 13 letter from Sen. Elizabeth Warren questioning how the Treasury used its Exchange Stabilization Fund during last month's coordinated U.S.-Japan currency operation.

Bessent rejected that premise, saying Treasury simply exchanged foreign-currency assets already held by the ESF for yen. 'No new congressional appropriation was involved,' Bessent wrote, adding that Japan owes Treasury nothing because no credit was extended.

The U.S. action formed part of a larger Japanese effort to stabilize the currency after the yen fell beyond 163 per dollar, near its weakest level in roughly four decades.