Japan and US confirm rare joint intervention to support yen

Japan and the United States have confirmed a rare coordinated intervention in foreign exchange markets to buy yen and slow the currency's decline. The move was aimed at halting the yen's slide to 40-year lows and at countering what officials described as excessive volatility and disorderly movements. Tokyo said it remains ready to act again if needed, while Washington framed the step as support for market stability and the wider global economy.

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Japan's Ministry of Finance said the intervention took place on Friday in coordination with the US Treasury Department. The ministry said the action was taken after recent months of disorderly yen movements, and added that it remains in close communication with its US counterparts. US Treasury Secretary Scott Bessent also confirmed the effort and said the two sides would not hesitate to carry out further joint intervention if necessary.

The announcement followed comments from US President Donald Trump, who said helping to bolster the Japanese currency was a sign of friendship. He said Japan had a weakening yen and wanted some help, adding that the United States was always there for Japan. After his remarks, the dollar fell 0.2% to 157.07 yen before rising back to 157.70 yen after the Japanese finance ministry's statement.

The intervention matters because the yen's weakness has become a broader economic and financial issue, not only a domestic one. A weaker yen raises import prices in Japan, adding to inflation pressures and affecting household budgets. Officials and analysts also see risks of spillover into Japanese government bonds and, potentially, into US borrowing costs if market stress deepens.

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The yen has been under pressure for structural reasons as well as market sentiment. Japan has kept interest rates well below those of other major economies for much of the period, making the currency less attractive to international investors. The Bank of Japan raised its main rate to 1% in June, the highest level since September 1995, but the gap with US rates remains wide.

The joint action is notable because it is the first coordinated intervention by the two countries since 2011. That earlier move came after the devastating earthquake and tsunami in eastern Japan, when both governments acted together to weaken the yen. This latest intervention is the reverse in direction, with both sides now trying to support the currency rather than push it lower.

Bank of Japan data suggested Tokyo may have sold as much as $58.97bn to buy yen when it intervened in New York markets on Thursday, before the confirmed joint action with Washington on Friday. The US has not confirmed the size of its own participation. The scale of the operation, and whether it was enough to change the broader trend, remains unclear.

What happens next will depend on whether the yen stabilises and whether officials judge further action is needed. Japan's finance ministry has said it will not hesitate to conduct more joint intervention, and Bessent has echoed that position. Market attention will now focus on whether the currency's recent rebound can hold and whether policymakers in Tokyo and Washington continue to act together.

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SEO_DESCRIPTION: Japan and the United States have confirmed a rare joint intervention to buy yen, aiming to curb disorderly currency moves and support market stability.

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