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KST
Japan’s Ministry of Finance confirmed on August 3 that it carried out a coordinated yen-buying intervention with the U.S. Treasury on July 31, marking the first joint intervention to support the yen since 1998 and the first Japan-U.S joint currency intervention of any kind since 2011. The move came after the yen slid to 163.73 per dollar the previous Thursday, near a 40-year low, before rebounding to 157.57 on Friday. By Monday, the currency had strengthened further, briefly touching a nearly three-month high of 155.20 per dollar.
Tokyo said the action, taken under the September 2025 Joint Statement of the Japanese and U.S. Finance Ministers, addressed “excessive volatility and disorderly movements” in the currency and signaled it would not hesitate to intervene again. U.S. Treasury Secretary Scott Bessent confirmed the operation, while President Donald Trump described the support as a gesture of friendship toward Japan.
The intervention follows months of behind-the-scenes coordination between Japanese Finance Minister Satsuki Katayama and Bessent, according to people familiar with the preparations. Pressure had mounted through July as Prime Minister Sanae Takaichi’s expansionary fiscal stance weighed on the yen, driving up import costs and denting the administration’s approval ratings.
Analysts say the alignment reflects shared interests: a weak yen has fueled inflation in Japan while blunting the trade advantage of U.S. tariffs and risking spillover from Japanese government bond volatility into U.S. Treasury markets. Bank of Japan Governor Kazuo Ueda’s recent hawkish remarks were read by markets as signaling a possible September rate hike, a step economists say is needed for any sustained yen recovery beyond intervention alone.
