The Japanese yen surged to its strongest level in months after a rare joint intervention by Tokyo and Washington, with US Treasury Secretary Scott Bessent reportedly planning to purchase billions of yen, according to multiple reports. The move, which came after the yen had fallen to a 40-year low, underscores the deepening economic interdependence between the two allies.

Coverage Comparison

Reports from ABC Australia, The Guardian, and the South China Morning Post each describe a coordinated effort to bolster the yen, though they emphasize different aspects of the story.

The Guardian focused on the unusual manner in which the plan came to light: a scribbled "to do" list left visible to a Reuters photographer during a cabinet meeting at Camp David. The photograph, taken over Bessent's shoulder, showed a notepad with the underscored words "To Do" followed by "Buy Japanese Yen (JPY) $5-10 bil." The Guardian noted that the US Treasury had not intervened to prop up the yen since 2011, when it joined other G7 countries in a coordinated action following a devastating earthquake and tsunami in Japan.

ABC Australia framed the story as a significant shift in US policy, highlighting the US's "huge vested interest" in a stronger yen. The outlet reported that the intervention involved selling euros rather than US dollars to purchase yen, a detail that underscores the complexity of the operation. ABC also noted the potential risks a weak yen poses for the US Treasury bond market, given that Japan is the largest holder of US Treasury bonds.

The South China Morning Post emphasized the historical significance, calling it the first yen-buying joint intervention since 1998. The outlet also reported that US President Donald Trump called the move "a signal of friendship" with Japan in an interview aboard Air Force One.

Key Claims

  • US Treasury Secretary Scott Bessent revealed a plan to buy \$5-\$10 billion in Japanese yen, as reported by all three outlets. The plan was disclosed through a scribbled "to do" list left visible to a Reuters photographer, a detail carried by The Guardian and South China Morning Post.
  • The US Treasury has not intervened to prop up the yen since 2011, according to The Guardian.
  • Japanese authorities had already stepped in to support the yen earlier on Friday, before the plan came to light, as reported by The Guardian.
  • The dollar dropped from about 158.9 yen to about 157.6 yen during the late afternoon on Friday, a decline of about 0.8%, according to The Guardian, citing data from LSEG.
  • The US has a huge vested interest in a stronger yen, as reported by ABC Australia, which also noted that a weak yen poses risks for the US Treasury bond market because Japan is the largest holder of US Treasury bonds.
  • The US sold euros to boost the yen rather than using US dollars, a detail reported by ABC Australia.
  • The intervention was the first yen-buying joint intervention since 1998, as reported by the South China Morning Post.
  • The Japanese yen surged after the rare intervention, rising as high as 155.23 per US dollar, its strongest level since early May, according to the South China Morning Post.
  • US President Donald Trump called the move "a signal of friendship" with Japan, as reported by the South China Morning Post.

Perspectives

US Government: President Trump described the intervention as "a signal of friendship" and emphasized that the US was "always there for Japan," according to the South China Morning Post. Treasury Secretary Bessent also stated on social media that the US "will not hesitate to participate in further joint intervention."

Analysts: Qian Wei, chief analyst at China Securities, told the South China Morning Post that Japan's intervention was largely about seizing a favorable window, while US involvement could be aimed at limiting selling pressure on US Treasuries. This analysis highlights the strategic considerations behind the move beyond simple currency support.