Treasury Secretary warns on forced sales
U.S. Treasury Secretary Scott Bissent stated that unorganized intervention in the Japanese yen exchange market could lead to forced liquidation of financial positions, threatening global market stability and increasing borrowing costs for American households and businesses. He explained that Japan and the United States conducted a joint intervention on July 31 to buy yen in an effort to prevent a widespread sell-off across the market, during which the yen rose from its 40-year lows but later declined again amid expectations of interest rate hikes by both the Bank of Japan and the Federal Reserve. The Treasury Department utilized the Foreign Exchange Stabilization Fund to counter the currency's deterioration, which is a backup mechanism managed to help stabilize domestic and global currency markets.
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