U.S. Yen Purchases Worth 79.4 Billion Yen Reveal First Intervention Since 1998
Key Facts
A New York Fed report published on November 12 revealed that the bank bought 79.4 billion yen, equivalent to 497.37 million dollars, in the spot market on July 31 on behalf of the U.S. Treasury. Reuters said the operation was the first U.S. intervention to buy yen since 1998. The New York Fed executed the trade as the Treasury's fiscal agent, selling euros from the Exchange Stabilization Fund. The operation aimed, according to the report, to counter moves in the Japanese currency that the Treasury considered disorderly. The delayed disclosure puts the scale of the July intervention in the context of the yen's return to sharply weak levels in November.
The trade came as the dollar was worth about 164 yen on July 30, before the dollar-yen pair fell to about 155 yen on August 3 following the interventions, Reuters reported. On July 30, the yen rose 2.3% against the dollar, the day reports emerged that the New York Fed had requested a rate check on behalf of the Treasury. The sequence points to a rapid response in the foreign-exchange market around the time of the intervention, with the dollar falling about 9 yen between the two approximate levels cited. This does not mean the U.S. move was a large-scale purchase; the reported amount was 79.4 billion yen. At the November 12 close, the dollar stood at 159.828 yen, according to EL7 data.
Yen pressure returned to the fore on November 13, when it briefly topped 160 per dollar overnight for the first time since early September, Reuters reported. Japanese Finance Minister Satsuki Katayama renewed her warning over currency moves as investors watched for the possibility of fresh official action. The breach of that level is separate from the U.S. purchase in July, which was disclosed only in a November report. Katayama said Japan "will not hesitate to carry out an additional joint intervention." The statement comes as the currency remains weak, putting pressure on the domestic economy.
The weak yen raises the cost of fuel and imported goods, squeezing Japanese households already facing higher prices, Reuters reported. It also adds pressure on the Bank of Japan to continue monetary tightening and narrow the interest-rate gap. Reuters linked the yen's weakness in recent days to a rising dollar and higher U.S. Treasury yields, as bets grew on a larger U.S. rate increase the following month. The dollar reached a 19-month high against major currencies, according to the report. This divergence in the U.S. and Japanese interest-rate paths stands out as a factor affecting demand for the two currencies, alongside authorities' interventions in the foreign-exchange market.
On November 13, Reuters said an Oxford Economics economist viewed the impact of the latest intervention as appearing more durable than previous interventions during the year. The economist added that the yen could follow a slightly stronger path for the rest of the year, while structural weakness factors remain in place. This assessment does not eliminate pressures linked to the interest-rate gap or import costs, while Japan's finance minister has pledged that an additional joint intervention remains possible. On U.S. data, the Bureau of Labor Statistics set December 10, 2026, as the release date for the November Consumer Price Index. The release is due after the New York Fed report disclosed the July operation, and as the yen again tests the 160 level in November.