Japan and the United States are expected to reactivate coordinated yen-buying intervention, marking a shift toward correcting yen weakness. Pressure for the Bank of Japan to raise interest rates may increase, prompting greater market vigilance.
Nomura Securities Chief FX Strategist Goto Yujiro (後藤祐二朗) explains that the Japanese and US governments are said to have conducted coordinated yen-buying intervention on 31 July 2026, sending the market sharply toward a stronger yen. The intervention has attracted attention as the first coordinated operation in 15 years, since 2011, and its potential impact and outlook are discussed.
According to media reports, the US Treasury is said to have conducted intervention to sell euros and buy yen through the Federal Reserve Bank of New York, while indications emerged that the Cabinet would announce a Japan-US policy aimed at correcting yen weakness. Japan's Ministry of Finance subsequently expressed its intention to continue coordinated intervention and said it would not hesitate to intervene jointly in the future. Market concerns about another intervention may increase.
As for the nature of the intervention, it has been suggested that euros, rather than US dollars, may have been sold against the yen, and some believe this gives the coordinated intervention a more substantive character. Past examples show that intervention to correct yen weakness has been carried out around turning points, and whether this operation will also mark a turning point is said to depend on future fundamentals.
Regarding the possibility that pressure for the Bank of Japan to raise interest rates will increase, the focus is expected to be on changes in the BOJ's policy stance, along with the effects of oil prices and US monetary policy. The Ministry of Finance's foreign exchange report expressed the view that monetary policy normalization would help stabilize the yen, suggesting that the US side may encourage the BOJ to normalize monetary policy.