Japan’s FX Interventions Hit Record Monthly High
Japanese authorities spent ¥15.39 trillion (15,399.3 billion yen) on foreign exchange market interventions between July 30 and Wednesday, according to data released by the Finance Ministry on Friday. The figure marks the largest monthly amount ever spent on yen-buying, dollar-selling operations.
The interventions were conducted by the government and the Bank of Japan to counter the historic weakening of the yen. This series of actions followed a previous round during Japan’s Golden Week holiday period in late April and early May, when authorities spent ¥11.73 trillion.
With Friday’s disclosure, the cumulative amount of intervention operations this year has now exceeded ¥27 trillion, surpassing the previous annual record of about ¥15 trillion set in 2024.
Market Context and Currency Movements
In late July, the dollar approached ¥164, reaching its highest level in about 39 years and eight months. On the night of July 30, the dollar plunged by roughly ¥5 to slip below ¥158, following the interventions. It later advanced back above ¥160 the next day, only to fall below ¥158 again. On Aug. 3, the greenback also dived against the yen.
Despite these efforts, as of Friday the dollar had risen to around ¥160, reflecting ongoing concerns about inflation stemming from the Middle East crisis, the interest rate gap between Japan and the United States, and caution over the expansionary fiscal policy of Prime Minister Sanae Takaichi’s administration.
Coordinated Action and Official Statements
Finance Minister Satsuki Katayama and U.S. Treasury Secretary Scott Bessent said on Aug. 3 that Japanese and U.S. authorities had carried out a joint yen-buying, dollar-selling intervention on July 31—the first such coordinated action in about 28 years. They expressed a commitment to coordinated efforts to stop the yen’s depreciation, stating that Japanese and U.S. authorities would not hesitate to further coordinate interventions. The size of U.S. intervention operations has not been disclosed.
At a news conference the same day, Katayama reiterated the strength of the bilateral commitment, describing the Japan-U.S. finance ministers’ joint statement from September last year—which supported currency intervention—as “very strong.” Many market participants, however, believe it remains challenging to reverse the yen’s downward trend solely through intervention measures.