US Treasury Warns of Potential Yen Intervention Ahead of Friday Market Move

The US Treasury has sent a warning to major banks that it may intervene in the Japanese yen market on Friday, signaling a potential coordinated effort with Tokyo to stabilize a currency that has fallen to four-decade lows against the dollar.

The notice, channeled through the Federal Reserve Bank of New York, tells banks to 'stand ready for future action', according to a source familiar with the matter.

This move comes after Japanese authorities executed a surprise intervention on July 30, pushing the yen up over 3% to its strongest level since 2022. The currency had been trading near 164 yen per dollar, a level not seen in roughly four decades.