Yen hits three-month high after Trump helps prop up currency — SkimNews
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- Tokyo's finance ministry confirmed the coordinated yen-buying intervention late last week and said authorities "would not hesitate to take further action," after the yen had slumped to almost ¥164 per dollar, roughly a 40-year low.
- Bank of Japan data, reported by Reuters, suggests Tokyo spent as much as $36.58 billion on Friday alone to purchase yen and strengthen the currency, its largest single-day defense in years.
- US Treasury Secretary Scott Bessent said Washington "will not hesitate to participate in further joint intervention" while reiterating calls for the Bank of Japan to raise interest rates; a photograph of his cabinet-meeting notebook showed a $5 billion to $10 billion yen-buying item on his to-do list.
- The Financial Times reported that Washington sold euros rather than dollars to acquire yen — a technical choice analysts said likely reflected a desire to avoid signaling that the US wanted a weaker dollar.
- Oxford Economics cautioned that the intervention alone won't reverse the yen's weakening trend, projecting the BoJ will hold off on rate hikes until December because the operation has dialed back the risk of a sharp yen plunge.
- Donald Trump framed the operation as a favor to an ally, telling reporters Japan "wanted a little bit of help" and that "we're always there for Japan," which marked the first US-Japan joint currency action since March 2011.
- The yen's underlying weakness, the article notes, was fueled by interest-rate gaps that drove carry trades, and by concerns about Prime Minister Sanae Takaichi's stimulus push and her public criticism of the Bank of Japan's tightening.
Why it matters: The coordinated move underscores Washington's willingness to deploy its currency firepower to backstop a key ally, but the euro-for-yen mechanics show the US trying to support Tokyo without reopening dollar-weakness debates. With Oxford Economics projecting no rate hike until December, Japan will likely need to lean on repeated interventions — the only remaining lever before the BoJ moves.
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