US and Japan Unite to Rescue Yen from Precipice, Intervention Underway
The Japanese government is expected to announce that Tokyo and Washington have conducted a joint intervention in the foreign exchange market to stop the yen’s decline, which recently touched its lowest level in almost 40 years.
According to Reuters, Japanese Finance Minister Satsuki Katayama is scheduled to make the announcement on Monday (3/8/2026). Two Japanese government officials familiar with the matter stated that the move aims to curb the yen’s depreciation, which is deemed excessive against the US dollar. Katayama is also expected to reaffirm the commitment of both Japan and the US to jointly maintain exchange rate stability. When asked if the government would announce a ‘joint action’, one source replied, ‘Yes,’ adding that the intervention operation is still ongoing.
The Japanese Ministry of Finance has not yet provided an official response, while the US Treasury Department has also not responded to requests for comment. If confirmed, this would mark the first joint intervention by Japan and the US in the foreign exchange market since 2011. The move follows the yen’s slump to its lowest level against the US dollar since 1986.
Market sources indicate that the Japanese government conducted yen purchases and dollar sales during the New York trading session on Thursday (30/7/2026) local time. This intervention occurred just hours before the Bank of Japan (BoJ) decided to maintain its benchmark interest rate on Friday (31/7/2026), while signalling the possibility of interest rate hikes in the near future.
Support from the US government was also evident in statements from US Treasury Secretary Scott Bessent last week, who noted that the yen ‘appears significantly undervalued’. Furthermore, a Reuters photograph from a US cabinet meeting on Friday showed notes from Bessent containing a task list that included the point ‘Buy Japanese Yen (JPY) US$5-10 bil’. Additionally, the US Treasury Department reportedly notified several banks on Friday that the government would likely intervene in the yen market again, requesting they prepare for further actions.