Overview
- The United States and Japan executed a coordinated yen-buying operation around July 31 that lifted the yen from about 164 to the mid-150s against the dollar.
- U.S. Treasury Secretary Scott Bessent publicly pledged to “do whatever it takes” to support yen stability and said the move reflected worries about wider Asian financial spillovers.
- A Reuters poll of FX strategists found nearly 95% believe interventions alone will not produce a sustained yen recovery without the Bank of Japan raising rates.
- The joint action eased immediate market stress, helping push the dollar toward multi-week lows as oil prices fell and risk appetite rose, but traders remain skeptical about the durability of the rally.
- Markets are now focused on upcoming BOJ and Fed meetings for any shift in interest-rate gaps and on the risk of further official action, with knock-on effects for import costs, inflation and global Treasury markets.