Despite past interventions by the United States and Japan, the yen continued to weaken, and the July 2026 intervention involved selling euros to buy yen. The yen moved above ¥159 to the dollar, but this did not lead to a lasting reversal of its decline. The possibility of further intervention is also being discussed ahead of the Bank of Japan’s policy meeting.
The effects of past interventions are viewed as limited, and the yen is once again in a declining phase, having given up much of the gains made after the latest intervention. This has prompted comments that fundamental factors are weighing on the yen.
According to a report by Fortune, the July 2026 intervention involved the New York Fed selling euros and buying yen, rather than selling dollar-denominated assets. This is viewed as having avoided additional supply to the U.S. Treasury market.
Japan reportedly used FIMA instead of opting for additional sales of U.S. Treasuries. The short-term objective of both countries is to bring the dollar-yen exchange rate below ¥155, but the actual rate has remained above ¥159. The U.S.-Japan yield differential remains wide at approximately 1.84 percentage points, and capital continues to favor dollar-denominated assets over yen-denominated assets.
Experts assess that the intervention helped reset market sentiment, but was insufficient to overturn the underlying factors. Over the longer term, a combination of measures, including normalization of the Bank of Japan’s monetary policy and expanded domestic investment, is considered necessary.