Bessent says U.S. backed Japan’s yen intervention to help stabilize Asia

📰 source: cnbc_topnews · 💼 business

treasury secretary scott bessent said tuesday the u.s. joined japan's yen-buying intervention because a weak yen risked destabilizing asian markets. he called a stable yen 'very important for the entire region' and pointed to volatility in the south korean won and concerns about china's undervalued yuan.

the treasury department sold euros from u.s. reserves to buy yen as part of the coordinated operation, a rare u.s. move to support another major currency. bessent said he assured european officials the euro sale was just a reallocation. he described the yen as 'substantially undervalued' and said the purchases could only curb volatility short-term, needing follow-up from japanese policies addressing the forces driving the yen lower.

but bessent cautioned intervention alone won't determine the currency's direction. 'you can give market signals with intervention, but it's policy that turns it,' he said, declining to say whether the bank of japan should raise rates. he said the u.s. participated because it was optimistic about japan's policy path.

why it matters: rare u.s.-backed yen intervention signals concern over asian currency stability, a risk for global trade and inflation.

source: cnbc_topnews
sentiment: +0.30 · impact: 0.60