Japan spends nearly $100 billion in a single month to intervene in the foreign exchange market, setting a record high

⑴ Data from Japan’s Ministry of Finance shows that, in the four weeks ending August 26, the Japanese government injected approximately $96.4 billion (about 15.4 trillion yen) into foreign exchange market interventions, setting a record for the largest scale of intervention in a single month, after the yen had previously fallen to its lowest level in forty years.⑵ This intervention received explicit support from the United States. The two countries conducted coordinated intervention on July 31, with Japan’s Minister of Finance and the US Secretary of the Treasury jointly confirming the action and expressing that, if necessary, they would not hesitate to enter the market again. Although the US participation was not included in the figures released by Japan, its symbolic significance substantially strengthened the deterrence signal.⑶ The record-breaking intervention highlights that Japanese authorities, amid the continued weakness of the yen, are taking increasingly forceful measures to support the exchange rate. The coordinated intervention aims to send a clearer bilateral warning to speculators—that the risks of betting on unilateral yen depreciation are rising.⑷ The market will closely monitor subsequent fluctuations in exchange rates and official statements. If the yen again faces depreciation pressure, the possibility of renewed US-Japan coordinated intervention remains. However, the sustainability and diminishing marginal effectiveness of large-scale and prolonged interventions will also become focal points for market evaluation.