US Treasury signals possible yen-buying intervention

2026-07-31

It was learned that the US Treasury on the 31st told the market that additional yen-buying, dollar-selling intervention could be possible. Following the 30th intervention by the government and the Bank of Japan, it became clear that US authorities were also wary of speculative yen selling.

Possible intervention conveyed to multiple banks

A US official said on the 31st in response to a Nikkei interview that the US Treasury, through the Federal Reserve Bank of New York, had told multiple banks of the possibility of yen-buying intervention on the day and to prepare for it.

The foreign exchange market, which had been around the 163 yen level to the dollar in the evening of the 30th, surged to the 157 yen level at night after the government and the Bank of Japan intervened to buy yen. Treasury Secretary Bessent has long been wary of excessive yen weakness, and the US currency authorities effectively backed Japan's intervention.

The US side is concerned that a 'sell Japan' move in currencies and bonds could lead institutional investors to sell US Treasuries. Since the start of 2026, US officials have cooperated with Japan's yen-buying intervention while also voicing concerns about the Bank of Japan's delay in raising interest rates and about fiscal deterioration.

Even during the yen weakness in January, the US Treasury, under Bessent's leadership, conducted a 'rate check' in the market, a step taken before foreign exchange intervention. At the time, joint Japan-US intervention was also under consideration as one option.

Also confirmed in euro-yen

According to multiple market participants, the Federal Reserve Bank of New York carried out rate checks in euro-yen transactions in addition to dollar-yen transactions.

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