All eyes are on the currency market after well-informed sources revealed that the U.S. Treasury Department has notified a number of banks of the possibility of U.S. intervention to support the yen in the Japanese market.
It urged them to be prepared to take potential measures in the coming period.
The notification, which was distributed via the Federal Reserve Bank of New York, came after Japanese authorities intervened to support the yen.
This helped the currency rebound from its lowest levels in four decades against the dollar and post strong weekly gains.
Following the news, the yen rose against the dollar to trade at around 159.61 yen per dollar, an increase of 0.06% during trading.
U.S. Treasury Secretary Scott Bessent said the yen appears to be significantly undervalued.
He considered excessive currency fluctuations to be unhealthy.
The possibility of U.S. intervention to support the yen brings to mind Washington’s 2011 move as part of a coordinated G7 intervention to stabilize the Japanese currency.
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