US Treasury Intervention in the Yen Market
On Friday, 1 August 2026, the U.S. Treasury intervened in foreign‑exchange markets by purchasing Japanese yen and selling euros. The Federal Reserve Bank of New York carried out the euro sale and yen purchase on the Treasury’s behalf, marking a direct U.S. government action in the currency market.
Goldman Sachs Group Inc and Morgan Stanley were the broker‑dealers that executed the yen purchases, as reported by the Financial Times. Earlier that day, the Treasury notified several banks that it could intervene in the yen market and asked them to stand ready for future action.
The news of a possible U.S. intervention helped the yen appreciate against the U.S. dollar during Friday’s trading session. This followed an apparent intervention by Japanese authorities on Thursday, where Bank of Japan data suggested Japan may have sold up to $58.97 billion of foreign currency to buy yen in an effort to halt the currency’s slide toward four‑decade lows.
The coordinated actions represent a significant escalation in attempts to support the yen, whose weakness has been raising Japan’s import costs and adding to inflationary pressures. While a stronger yen could ease import‑related inflation, it may also reduce the overseas earnings of Japanese exporters when converted back to yen.
The U.S. Treasury, the New York Fed and Morgan Stanley were not immediately available for comment outside regular business hours, and Goldman Sachs declined to comment.