Washington steps into currency markets for the first time in years to counter rapid yen depreciation against the dollar.
The US Treasury intervened in global foreign exchange markets to stabilize the yen, marking a rare departure from its long-standing hands-off policy. The move follows a sharp decline in the Japanese currency, which hit multi-decade lows against the dollar, raising concerns over market stability and trade imbalances.
Historically, US authorities have refrained from direct forex intervention, favoring market-driven exchange rates. The last major intervention occurred in 2011, when the Group of Seven nations acted to curb yen volatility after Japan’s earthquake and tsunami. Analysts note the yen’s slide has accelerated in recent months, driven by diverging monetary policies between the Federal Reserve and the Bank of Japan.
Markets reacted cautiously to the intervention, with the yen recovering slightly from session lows. Traders are now watching for further signals from US and Japanese officials on potential coordinated action.