Warren presses Bessent as U.S.-Japan yen intervention loses traction

Senator Elizabeth Warren asked Treasury Secretary Scott Bessent by Aug. 28 to explain the legal basis, taxpayer cost and any related support for Japan tied to the Trump administration's late-July yen intervention, the first coordinated U.S.-Japan currency operation since June 1998. Bessent has said the United States used euro reserves from the Treasury's Exchange Stabilization Fund, while newer reporting estimated Japan bought $75 billion to $85 billion of yen over two days and said U.S. authorities signaled willingness to use Federal Reserve facilities. The operation briefly pulled dollar-yen from near 164 to the 155 range and triggered a sharp reduction in speculative short-yen positions, but the pair later rebounded to around 159-160, leaving South Korea-listed yen ETFs with weaker or negative 2024 returns than comparable products without yen exposure. Analysts including Park Sang-hyun of iM Securities said further intervention remains possible, citing the Fed's FIMA repo facility, but warned that Japan's fiscal risks, carry-trade dynamics and the limited scope for additional Bank of Japan rate hikes could keep pressure on the yen.

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