Coverage spread: 3 sources — 2 center · 1 international
Lean ratings via AllSides / Media Bias-Fact-Check. How this works.
Where they agree
- The US and Japan jointly intervened last Thursday and Friday to stop the yen’s slide after it hit a 40-year low near 164 to the dollar.
- This marked the first joint intervention to support the yen since 1998, and the first coordinated action of any kind since 2011’s Fukushima-related move.
- Japan spent tens of billions of dollars (estimates range from $52.8 billion to $59 billion), while the US contribution, estimated at $5-10 billion, comes from a leaked notepad photo of Bessent rather than an official figure.
- Both governments, through Bessent, Trump, and Japan’s finance ministry, say they are prepared to intervene again if needed.
- Fortune is the only outlet to report and analyze the unusual detail that the New York Fed funded its purchase by selling euros rather than dollars, and it features expert criticism (Truman, Brooks, Sobel) questioning that choice’s effectiveness.
- MarketWatch’s headline questions whether the intervention “will be enough” but no article text was available to detail its reasoning.
- BBC focuses more on the structural, long-term causes of yen weakness — interest rate gaps, demographics, energy import reliance — and includes Oxford Economics’ Nagai explaining the US’s strategic incentive to help.
- Fortune’s second piece and MarketWatch emphasize the Monday follow-up rally and speculation of a second intervention round, while BBC centers on the Monday confirmation statements from both governments rather than market speculation.
What happened in the market
Japan’s yen tumbled to a 40-year low, trading near 164 to the dollar, before the United States and Japan carried out a coordinated intervention on Thursday and Friday to prop it up. Bank of Japan data suggests Tokyo sold roughly $52.8 billion to $59 billion in dollars to buy yen. The exact size of the US contribution has not been officially confirmed, but a Reuters photograph of a notepad in front of Treasury Secretary Scott Bessent during a cabinet meeting read “To Do: Buy Japanese Yen $5-10 bil,” which is being used as the best public estimate of Washington’s share.
The combined action pushed the yen up more than 1% to close around 157.40 per dollar on Friday, reversing more than two months of losses in just two days. On Monday, the yen rallied again, at one point gaining as much as 1.4% intraday before settling around 156.70, fueling speculation that authorities had stepped in a second time. Under International Monetary Fund guidelines, a currency can still be considered free-floating if intervention is limited to three episodes within six months, each lasting no more than three business days — a threshold Japan has room to use again.
Why the euro detail matters
This was the first joint US-Japan intervention to support the yen since 1998 during the Asian financial crisis, and the first joint action of any kind since 2011, when the two countries worked together to weaken the yen after the Fukushima disaster made it too strong for Japan’s exporters. What made last week’s move unusual, according to Fortune’s reporting, is that the New York Fed reportedly funded its purchase by selling euros rather than dollars — a departure from the standard playbook of selling dollars directly to buy yen.
Currency experts flagged this as a potential problem. Edwin Truman, a former Treasury assistant secretary for international affairs, called the euro-funded approach “weird” if the actual goal was to strengthen the yen against the dollar, arguing that selling dollars directly would have been more effective. Robin Brooks of the Peterson Institute for International Economics said routing the trade through euros could undercut the intervention’s credibility, since FX intervention works partly as a “confidence game” and any oddity in execution invites market skepticism rather than certainty.
What officials are saying
Bessent said the coordinated action “countered disorderly yen movements” and that the US “strongly supports Japan’s decisive market and monetary steps to correct the substantial undervaluation of the yen.” President Trump called the intervention “a signal of friendship,” telling reporters Japan “wanted a little bit of help” and “we’re always there for Japan.” Japan’s Finance Minister Satsuki Katayama confirmed the joint action, and Japan’s finance ministry said it was meant to counter “excessive volatility and disorderly movements” in the currency. Both Tokyo and Washington have said they won’t hesitate to intervene again.
Why the yen is so weak
Sources point to a mix of structural causes. The Bank of Japan’s benchmark rate sits at 1% — its highest since 1995 but still far below the US Federal Reserve’s 3.50%-3.75% range — making the yen less attractive to global investors. Mark Sobel, a four-decade Treasury veteran now with the Official Monetary and Financial Institutions Forum, pointed to Japan’s “overly accommodative” monetary policy, debt concerns, and more recently the fiscal approach of Prime Minister Sanae Takaichi. The BBC also cites Japan’s shrinking working-age population, weak productivity, and heavy reliance on dollar-priced energy imports as long-running drags on the currency. Analysts including Goldman Sachs’ Kamakshya Trivedi describe intervention as a way to “buy time” rather than fix these underlying issues, while Oxford Economics’ Shigeto Nagai argued the US joined partly because it offers Washington low-cost benefits, including easing pressure that a yen and Japanese bond sell-off could put on global borrowing costs, including America’s own.
What’s still unresolved
Skeptics, including Brooks, expect the yen’s decline to resume because the Bank of Japan must keep bond yields artificially low to manage the country’s heavy debt load, which limits how far it can raise rates to support the currency organically. Sobel cautioned that US intervention is unwise unless it’s paired with a genuine Japanese plan to address the fundamentals driving yen weakness, noting that the Treasury’s Exchange Stabilization Fund “isn’t a hedge fund.” For now, markets are watching closely for signs of further coordinated action, with the yen’s May peak of about 155 per dollar seen as the next test level.
Sources
Featured photo by Ashkan Forouzani on Unsplash