Published August 3rd, 2026 - 11:54 GMT
ALBAWABA - Japan’s currency yen is suffering a significant weakening of its value, prompting the U.S. under the Trump administration to back the currency from failing as a sign of friendship.The yen slid to its weakest level since 1986 amid higher US interest rates, rising oil prices and persistent capital outflows, recording an exchange rate of 163.24 per dollar last month, prompting the US to intervene.The Financial Times reported that the Federal Reserve had taken the notable decision to sell off euros in order to buy yen on behalf of the U.S. Treasury, according to sources familiar with the matter."We're very strong -- very very strong financially. They are, you know, they have a weakening yen, and they wanted a little bit of help. And we're always there for Japan. Japan's been very good to us, with the exception, of course, of Pearl Harbor," President Trump said.Reporter: Why is the U.S. intervening to support the Japanese yen at this time?Trump: Japan’s been very good to us, with the exception, of course, of Pearl Harbor. pic.twitter.com/MY2uFdDBYA— Acyn (@Acyn) August 2, 2026 The U.S. boost came as the yen sharply rebounded, fueling speculation that the Japanese government had also intervened in the currency market; with Financial Times analyzing Japan's intervention to be about $52.8 billion while Nikkei estimates somewhere between $38.2 billion and $44.6 billion.In its statement, Japan's finance ministry said the move "countered excessive volatility and disorderly movements in the Japanese yen in recent months,"The Japanese Ministry of Finance remains attentive and in close communication with our counterparts at the US Treasury," it added. "We will not hesitate to conduct further joint intervention."This marks the first time in nearly three decades where the U.S. intervened in the yen, the last time being in 1998.
