US Treasury Joins Forces with Japan in Rare Yen Intervention

The US Treasury and Japan's Ministry of Finance have joined forces in a rare coordinated intervention to support the Japanese Yen, which had fallen to a 40-year low against the Dollar.

According to Bank of Japan data, Tokyo may have deployed almost $59 billion during Thursday's intervention, with Washington's involvement helping to address two risks at once: a destabilising collapse in the yen and the possibility that Japan could become a forced seller of US Treasuries as it raised dollars to defend its currency.

The Federal Reserve's FIMA repo facility will also allow Japan to obtain temporary dollar liquidity without selling its Treasury holdings outright, with US Treasury Secretary Scott Bessent describing the facility as an important backstop and saying that Washington is prepared to participate in further coordinated action.