US Treasury Steps In to Support Yen as Market Sees 40-Year Low

The U.S. Treasury Department intervened in currency markets to support the Japanese yen last Friday after it hit a 40-year low.

Treasury Secretary Scott Bessent described the move as 'coordinated foreign exchange actions countered disorderly yen movements.'

Bessent and President Donald Trump suggested that Japan was seeking assistance, but emphasized that shorting the currency would be taking on the financial firepower of the U.S.

The most obvious explanation for the intervention is that Bessent was worried about Japan selling its massive holdings of U.S. Treasury bonds, which could raise American interest rates.