Japan and the US Carry Out a Rare Joint Intervention to Defend the Yen

Japan's Ministry of Finance confirmed on August 3, 2026 that it bought yen in the currency market on July 31, acting together with the US Department of the Treasury — a rare instance of the two governments intervening jointly. The move followed weeks of sharp swings in the dollar-yen exchange rate that had unsettled currency markets.

Tokyo said the action was carried out under a framework the two countries' finance ministers agreed to in September 2025, and was meant to counter what it called "excessive volatility and disorderly movements" in the yen. Japan's Ministry of Finance said it remains in close contact with the US Treasury and "will not hesitate" to intervene again if conditions warrant it.

The two sides also pointed to a new financial mechanism going forward: Japan plans to draw on the Federal Reserve's Foreign and International Monetary Authorities (FIMA) Repo Facility. That facility lets foreign central banks and finance ministries borrow dollars temporarily by posting US Treasury securities as collateral, rather than selling those Treasury holdings outright on the open market to raise the dollars needed for an intervention.

Coordinated interventions between major economies are uncommon — most currency interventions are carried out unilaterally by a single country. US Treasury Secretary Scott Bessent separately confirmed the coordinated action in public remarks, saying it addressed disorderly yen movements and that Washington was ready to join further joint action if needed.