US Treasury Secretary Bessent: Will do whatever it takes to support Japan
Bessent said the intervention could be followed by policy changes as Japan weighs a Federal Reserve facility that would let it borrow up to $60 billion.
- On Friday, Treasury Secretary Scott Bessent confirmed the United States joined Japan in a rare, coordinated intervention to stabilize the Japanese yen after it fell to 40-year lows against the dollar.
- Bessent described the move as an effort to protect global "economic security" and counter "disorderly yen movements," warning that substantial undervaluation could trigger unhealthy competitive devaluations of other currencies.
- To fund purchases, the Treasury utilized euros from its Exchange Stabilization Fund, while Bessent encouraged Japan to use the Foreign and International Monetary Authorities Repo Facility to avoid dumping U.S. Treasuries.
- Although the intervention helped the yen rise, RSM chief economist Joe Brusuelas noted that market signals cannot replace necessary policy changes, as the currency remains vulnerable to interest rate gaps.
- The administration seeks to "upsize" the FIMA facility, potentially extending the Federal Reserve's role in supporting financial diplomacy alongside the Treasury to maintain stability in global markets.
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41 Articles
Japanese investors return to overseas bonds as stronger yen, higher yields boost demand
In a noteworthy development, Japanese investors turned their attention to foreign bonds for the first time in three weeks, driven by a strengthened yen and increasing overseas yields. Simultaneously, foreign investors returned to Japanese long-term bonds after earlier outflows, although they receded from Japanese stocks and short-term bills. This trend follows recent currency market interventions by both Japanese and US authorities.
US Joins Japan To Prop Up The Yen For The First Time Since 1998
Already a subscriber? Make sure to log into your account before viewing this content. You can access your account by hitting the “login” button on the top right corner. Still unable to see the content after signing in? Make sure your card on file is up-to-date. The United States has partnered with Japan to buy up Japanese yen and stop the currency from falling any further. Some shit you should know before you dig in: If you’re unaware,…
The American finance minister supports the Japanese currency and wants to prevent the biggest foreign owner from throwing his U.S. treasury on the market, otherwise it could be expensive.
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