US Treasury Intervenes in Yen Market with Euro Sale

The US Treasury intervened in the currency market on Friday to support the yen, which has been battered by Japan's efforts to stem its weakness. This is Washington's first intervention along with Tokyo since 2011, when it coordinated with fellow G7 nations to stabilise markets after Japan's earthquake and tsunami disaster.

The Federal Reserve Bank of New York conducted a sale of euros to buy yen on behalf of the Treasury through Goldman Sachs and Morgan Stanley. The reported action would be the US Treasury's first direct support for the yen since 2011, with no indication of any amounts of yen purchased.

A Reuters photo showed that US Treasury Secretary Scott Bessent was contemplating US purchases of US$5 billion to US$10 billion worth of Japanese yen. News of the potential intervention by the Treasury helped push the yen higher against the dollar on Friday from near 40-year lows earlier this week, with a notable jump during late afternoon trading.