US Treasury Steps In to Support Yen in Rare Intervention

US Treasury Secretary Scott Bessent has described the country's participation in yen intervention as a sign of support for its trusted partners, but some analysts see it differently. They believe that the administration is growing increasingly concerned about rising borrowing costs and wants to avoid forced selling of Treasury securities by their biggest overseas holder.

The US joined Japan in bolstering the yen last week, marking the first American yen intervention in 15 years and the first one to support the yen in 28 years. The intervention brought the Japanese currency to 155.23 per dollar, its strongest level since May.

The yen had been the worst-performing Group of 10 currency over the past 12 months due to its low bond yields, concerns about fiscal and monetary policy credibility, and a terms-of-trade shock delivered by the US-Iran war, which affects Japan's energy imports.