For the first time in fifteen years, Japan and the United States conducted a joint buying of Yen following the Japanese currency’s continued weakness to the U.S. Dollar which Finance Minister Satsuki Katayama confirmed yesterday, according to a Kyodo News report. The Yen fell to almost 164 to the U.S. Dollar on July 23.
To put things in perspective, posted below is an excerpt from the report of Kyodo News. Some parts in boldface…
Japan and the United States conducted coordinated yen buying Friday, Finance Minister Satsuki Katayama said, their first joint market intervention in 15 years, with the two nations ready to act again if necessary.
The intervention during New York trading on Friday came after the yen hit 163.99 to the U.S. dollar on July 23, its weakest level in around 40 years, amid mounting fears about Prime Minister Sanae Takaichi’s expansionary but vaguely funded fiscal policy.
“This joint action was taken pursuant to the U.S.-Japan Finance Ministers’ Joint Statement issued in September 2025 and countered the excessive volatility and disorderly movements of the Japanese yen in recent months,” Katayama said in a statement on Monday.
“The Japanese Ministry of Finance remains attentive and in close communication with our counterparts at the U.S. Treasury. We will not hesitate to conduct a further joint intervention,” she added.
After warnings by Katayama and U.S. Treasury Secretary Scott Bessent of additional action to prevent the Japanese currency from depreciating, the yen briefly surged to the lower 155 level from the upper 157 range on Monday morning.
While joint currency interventions by the countries are usually reserved for emergencies, Japan has been struggling with the yen’s depreciation, which has increased import costs, threatening to accelerate inflation and jack up yields on long-term Japanese government bonds.
Washington is also believed to be wary of rising long-term Japanese interest rates pushing up U.S. rates before the congressional midterm elections in the fall, analysts said.
The previous Japan-U.S. intervention was carried out to stem the yen’s rise after the massive earthquake and tsunami in northeastern Japan in March 2011.
Katayama told reporters in Tokyo that Friday’s coordination between Japan and the United States was aimed at linking Tokyo’s “economic security to its unwavering alliance” with Washington.
She stressed the countries’ “close coordination” since the release of their joint statement last September, which confirmed interventions should be reserved for combating excessive volatility as well as “disorderly depreciation or appreciation.”
Japanese and U.S. authorities have pledged to take decisive action “against disorderly moves at any time,” Katayama said.
Atsushi Mimura, Japan’s top currency diplomat, called the latest coordinated intervention a “completed form” of the Japan-U.S. currency alliance, emphasizing the two countries would continue to respond “without missing a beat.”
Saying Japan “wanted a little bit of help,” President Donald Trump indicated Sunday in the United States that Washington had conducted a yen-buying intervention at the request of Takaichi’s government. He told reporters the action would benefit his nation economically.
He added, “We’re always there for Japan. Japan’s been very good to us, with the exception, of course, of Pearl Harbor,” referring to Japan’s 1941 surprise aerial attack on a naval base in Hawaii that resulted in the U.S. entry into World War II.
In New York on Friday, the yen surged to the lower 157 level against the dollar, with Japanese government sources confirming a yen-buying intervention by currency authorities.
The move came after the yen briefly soared to the 157 range Thursday, gaining nearly 5 yen in about 50 minutes before dropping back to the 160 level, as a result of a currency intervention by Japan later confirmed by market and government sources.
On Sunday, Bessent wrote on social media that the intervention “countered disorderly yen movements,” adding the United States would “not hesitate” to conduct further joint currency intervention with Japan, echoing Katayama.
He also said, “We strongly support Japan’s decisive market and monetary steps to correct the substantial undervaluation of the yen.”
Let me end this piece by asking you readers: What is your reaction to this development? What do you think the joint buying of Yen by the US and Japan will lead to further stabilization economically in the short term? Do you think this joint move will somehow boost both nation’s economies?
You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.
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