Why the U.S. Stepped In to Prop Up Japan’s Yen Currency

The United States and Japan coordinated to prop up the latter’s yen currency after it fell to a 40-year low against the dollar.In a statement Monday morning, Japan’s Finance Minister Satsuki Katayama said the action was taken “pursuant to the U.S.-Japan Finance Ministers' Joint Statement issued in September 2025 and countered excessive volatility and disorderly movements in the Japanese yen in recent months.”The two countries “will not hesitate to conduct further joint intervention,” she emphasized, reflecting on the action carried out Friday.The yen is historically weak largely due to Japan having notably lower central bank interest rates than other major economies.According to Bloomberg analysis of central bank data, Japan most likely used around $34 billion intervening in the currency market to support the yen. TIME has been unable to independently verify these figures.“Economic security is national security. And the U.S.-Japan alliance is built on both,” said U.S. Treasury Secretary Scott Bessent on Sunday. Bessent also indicated the U.S. may consider increasing the size of the Federal Reserve's repurchase facility providing temporary dollar liquidity. “The FIMA Repo Facility i...