Yen Intervention Sets Daily Record as Pressure Persists

Japan's central bank intervened in foreign exchange markets in April to stem the yen's slide. The intervention, which took place on three days from April 30 through May 6, was a record single-day operation, with authorities selling $40 billion of Japan's currency reserves.

The largest operation, on April 30, amounted to 6.28 trillion yen ($39.64 billion), surpassing the previous single-day record set in April 2024. The intervention helped lift the yen from a near two-year low of 160.725 per dollar to around 155 by May 6.

However, the yen's downtrend continued, sliding to 40-year lows below 163 per dollar in July, prompting Japan to intervene again last week, this time in coordination with the U.S. Central bank data indicated Japan may have spent as much as $58.97 billion on July 30 and $36.58 billion on the following day.

To soothe market concerns about the limits of Japan's capacity for large-scale intervention, Tokyo and Washington said that Japan could utilize a COVID-19 era Federal Reserve backstop for major central banks.