US intervenes in Japan's currency market for first time in decade

President Donald Trump on Sunday hailed a rare US intervention in Japan's currency market as "a signal of friendship," confirming that Washington bought yen for the first time in more than a decade to support the weakening currency.

'Signal of friendship'

The intervention came after the Japanese currency fell to a 40-year low against the US dollar. "They have a weakening yen, and they wanted a little bit of help. And we're always there for Japan," Trump told reporters aboard Air Force One. His remarks followed a report by the Financial Times on Friday that the Federal Reserve Bank of New York sold euros to buy yen on behalf of the Treasury Department, citing sources familiar with the matter.

Joint action to curb volatility

Trump said backing the yen would be "good for the world economy," pointing to last year's $20 billion bailout for Argentina and the capture of Venezuelan President Nicolas Maduro as examples of US intervention. Treasury Secretary Scott Bessent said Washington and Tokyo jointly intervened in foreign exchange markets Friday to curb disorderly swings, adding the Treasury Department "will not hesitate to participate in further joint intervention." Japan's Finance Ministry echoed that stance, stating the action targeted "excessive volatility and disorderly movements."

First intervention since 2011

"We strongly support Japan's decisive market and monetary steps to correct the substantial undervaluation of the yen," Bessent said Sunday on the social media platform X. Trump said the intervention would also bring financial gains to the US without detailing how, and quipped that "Japan has always been very good to us, with the exception, of course, of Pearl Harbor." The move marked the first joint currency intervention since 2011, when the Group of Seven nations and the Bank of Japan coordinated action to sell yen following a devastating earthquake.