Why the Trump administration is helping support Japan’s weakening yen
Summary
The United States and Japan worked together to stop the Japanese yen from falling further against the US dollar. This joint action aimed to stabilize the yen because its decline affects not just Japan but the global financial system.Key Facts
- The yen dropped to its weakest level in 40 years against the US dollar.
- The US Treasury sold euros to buy yen, while Japan bought yen to support its value.
- The yen started rising after the intervention, improving from 163 to 157 yen per dollar.
- Japan has kept interest rates very low for decades to try to boost its economy, which has weakened the yen.
- Japan’s weak yen helps exports but makes imported goods more expensive for its people.
- The US intervened partly to protect global financial stability, not just to help Japan.
- A sharply falling yen could cause Japan to sell US Treasury bonds, which could disrupt financial markets.
- The US and Japan have previously intervened together in currency markets during financial crises.
Read the Full Article
This is a fact-based summary from The Actual News. Click below to read the complete story directly from the original source.
