Bessent note points to possible US yen purchase after Japan steps in
A Reuters photo showed US Treasury Secretary Scott Bessent’s notepad mentioning a possible US$5-10 billion yen purchase, after reports that Washington had alerted banks to possible intervention.
US Treasury Secretary Scott Bessent appeared to expose a note indicating possible purchases of US$5 billion to US$10 billion worth of Japanese yen, according to a Reuters photograph taken during President Donald Trump’s cabinet meeting at Camp David on Friday.
The image, taken during the on-the-record portion of the meeting, showed a notepad in front of Bessent bearing the words “To Do” followed by “Buy Japanese Yen (JPY) $5-10 bil”, Reuters reported. The photo was taken at 11.33am US Eastern Time.
A US Treasury spokesperson did not immediately respond to Reuters’ request for comment on the notepad or on whether the Treasury had intervened to support the yen against the dollar.
The development came after Reuters reported earlier on Friday that the US Treasury had notified several banks that it may intervene in the yen market, according to a source familiar with the matter. PostToday also reported that the message was passed through the Federal Reserve Bank of New York, signalling that banks should be prepared for possible future action.
Yen rebounds from near 40-year low
The move came shortly after Japanese authorities stepped in to support the yen in Tokyo, helping the currency recover from levels close to its weakest point in nearly 40 years.
Reuters reported that the yen strengthened to 159.09 per dollar after the intervention-related reports, recovering from 163.65 per dollar on Thursday.
Reuters also reported another sharp move later on Friday, with LSEG data showing the dollar falling from about 158.9 yen at around 4.14pm to about 157.6 yen shortly before 5pm, a decline of roughly 0.8%.
Japan hints at US support
Atsushi Mimura, Japan’s top currency diplomat, declined to comment directly on intervention, but suggested the US had played a supportive role in Japan’s efforts to stem the yen’s slide, including through so-called rate checks. Such checks are often viewed by markets as a possible precursor to intervention.
Lee Hardman, currency strategist at MUFG, said the report was consistent with market expectations that the New York Fed had begun rate checks, prompting investors to become more cautious over the possibility of further market intervention.
Bessent said on X that the US Treasury maintained close and ongoing coordination with Japanese authorities, but he did not confirm whether Washington was preparing to intervene in the yen market. He also said he was due to discuss the issue with Bank of Japan Governor Kazuo Ueda during a meeting of G20 finance ministers and central bank governors in Asheville, North Carolina, in late August.
Bessent had earlier told Fox Business Network that the yen was significantly undervalued, while saying high volatility in the Japanese currency was not good for the economy.
The last time the US Treasury intervened directly to support the yen was in 2011, when it joined other G7 countries in coordinated action after Japan was hit by a devastating earthquake and tsunami.
Source: reuters.com
