the news now
This is a new development in a story we have covered before · earlier coverage

US Treasury Secretary Scott Bessent Pledges Full Support for Japan to Stabilize Yen

morning · · thread: Oil Prices Drop as US and Iran Pause Military Hostilities

6 sources across 5 countries · 1 of them is linked to a state

Who reported this

  • Financial Times United Kingdom · Centre · Nikkei Inc.
  • Reuters United Kingdom · Centre · Thomson Reuters Corporation
  • The Japan Times Japan · Centre · News2u Holdings
  • The Straits Times Singapore · Centre-right · State-affiliated · SPH Media Trust; management shares under the NPPA
  • Neue Zuercher Zeitung Switzerland · Centre-right · Dispersed shareholders, no controlling stake
  • Bloomberg United States · Centre · Bloomberg L.P. (Michael Bloomberg)

What the colours mean

  • Left
  • Centre-left
  • Centre
  • Centre-right
  • Right
  • A hatched block means the outlet is affiliated with, or controlled by, a state.

Political lean describes where an outlet sits within the politics of its own country. It is never a position on a single global scale.

Political lean is comparable inside one country and not across them, which is why the bar groups by country first. Publicly funded broadcasters are not marked as state-linked.

The owner of each outlet is listed as a matter of record, not as a judgement about the outlet.

US Treasury Secretary Scott Bessent stated on August 4 that the United States will do whatever it takes to support Japan in stabilizing the yen. This commitment follows a joint intervention on July 31 where Washington and Tokyo bought the Japanese currency to prevent currency devaluations and protect both economies. Bessent noted that the yen is substantially undervalued, which he described as unhealthy because it could trigger further economic problems or competitive devaluations of other currencies.

To support these efforts, Bessent expressed support for the Bank of Japan using the Federal Reserve's Foreign and International Monetary Authorities Repo Facility. He suggested it would be reasonable for the Fed to consider increasing the size of this facility, which could allow the Bank of Japan to borrow up to 60 billion US dollars. Bessent also clarified that the US sold euros to buy yen, describing the move as a reallocation of resources and stating that the euro is closer to an equilibrium price.

Financial experts provided varying perspectives on the efficacy of these measures. Former Treasury Secretary Timothy Geithner suggested that intervention works best as a bridge to policy changes, such as interest rate hikes. Former Treasury Secretary Henry Paulson noted that Japan faces difficulty defying economic gravity due to high debt levels and expansionary policies under Prime Minister Sanae Takaichi. Some reports highlighted that Bessent is utilizing his background as a hedge fund manager to approach this rescue, including a strategy of allowing the media to see his tactical notes.

How each side framed it

Centre
These outlets focused on the tactical execution of the intervention and Bessent's professional background in hedge funds.
Centre-right
These outlets emphasized the broader economic risks, including the necessity of policy changes and the fragility of US government debt confidence.

Sources

100% of the statements in this article were traced back to the source articles listed above.