Bessent's Notebook Reveals Yen Purchase Plan, U.S. Treasury Has Intervened
U.S. Treasury Secretary Scott Bessent was photographed at a Camp David cabinet meeting with a "to-do list" item stating "buy 5-10 billion USD in yen." The photo was taken during a media open session at 11:33 AM ET. The Treasury Department spokesperson declined to comment.
The Financial Times reported that the U.S. Treasury intervened in the yen exchange rate on Friday, with the New York Fed selling euros to buy yen on behalf of the Treasury. The transaction was completed through Goldman Sachs and Morgan Stanley, marking the first joint direct purchase to support the yen by the U.S. and Japan in nearly 30 years. The Treasury had informed several Wall Street banks in advance.
Driven by this event, the yen gained policy support and appreciated, while Japanese assets and export-related targets faced pressure. The dollar and high-yen sensitive trades benefited from the intervention signals.
Source: Public Information
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Bessent previously stated that the yen is "seriously undervalued." The exposure of the notebook coincides with the actual intervention, continuing the tradition of U.S.-Japan coordination on exchange rate stability, but shifting from yen selling in 2011 to buying support.
In terms of resource mobilization, the New York Fed executed euro-yen operations through mainstream investment banks, motivated to assist Japanese authorities in curbing excessive volatility while avoiding market skepticism from unilateral interventions.
A similar approach was seen in the 1998 U.S.-Japan joint support for the yen and G7 coordinated interventions, with the current phase reflecting a policy shift after the yen approached a 40-year low.
This essentially represents a regulatory change: major reserve currency countries reshape exchange rate expectations through direct market operations, with the mechanism involving prior communication and cross-currency execution to reduce the impact costs of unilateral actions.
ABAB News · Law of Cognition
- Notebook exposures often signal real actions
- Joint interventions are more effective than unilateral statements
- When exchange rates are undervalued to a certain extent, allies will take action.