U.S., Japan intervene to buy yen, first in 28 years

2026-08-03

The United States and Japan moved to intervene jointly to stem further losses in the yen. A coordinated intervention to buy yen is the first since 1998, 28 years ago. Many market participants expect a bigger impact than a solo move by Japan, and some are forecasting the yen could strengthen to around 150 per dollar.

Memories of 1998

The previous coordinated yen-buying intervention came when yen weakness was accelerating amid the Asian currency crisis. The June 1998 intervention pushed the yen stronger by more than 10 yen in three days, but two months later in August it had slid back to the 147-yen area. Takuya Kanda, senior FX analyst at Gaitame.com Research Institute, said of the intervention at the time: 'It was only a stopgap measure and did not fundamentally change the market.' He said the backdrop was broader concern over Asian currencies rather than the yen's weakness itself, and it was not a Japan-specific issue.

Views split in market

Some see the move as a 'Reiwa Plaza Accord' aimed at correcting excessive yen weakness and dollar strength. Yuji Saito, executive adviser at SBI FX Trade, said many market participants have not experienced coordinated yen-buying intervention such as the 1985 Plaza Accord, and in an environment of deep uncertainty, yen buying is likely to lead the market.

Shusuke Yamada, chief Japan FX and rates strategist at BofA Securities, said that once authorities have resorted to unusual coordinated intervention, their intent to guide the yen stronger than the 155 level seen during interventions in April and May is strong. He expects speculative yen selling to be corrected and the yen to strengthen to 152 per dollar by year-end. Juntaro Morimoto, senior analyst at Sony Financial Group, also sees room for the yen to rise to around 150 to 152 per dollar, saying the move could be a catalyst to correct excessive yen weakness relative to the real interest-rate differential between Japan and the U.S.

Still, Hirofuku Ezawa, head of markets at Standard Chartered Bank, said a clear shift to a yen-buying trend is hard to expect because the U.S. stance is seen as limited to support. He pointed to the possibility of a return to 160 per dollar.

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