FX.co ★ Yen Holds Decline as Bessent Dismisses Intervention

On Thursday, the Japanese yen stabilized around 153.2 per dollar, after experiencing nearly a 1% drop in the previous trading session. This decline followed the rebound of the US dollar, spurred by comments from US Treasury Secretary Scott Bessent, who dismissed rumors of potential US intervention in the currency market to sell dollars and bolster the yen. Bessent reaffirmed the US's commitment to a "strong dollar policy," emphasizing that robust economic fundamentals should drive capital inflows, a stance that contrasts with former President Donald Trump's suggestion that a weaker dollar might be beneficial. Earlier in the week, the yen saw a significant rise of about 4%, reaching a three-month high on speculation regarding a possible coordinated intervention by the US and Japan to support the yen, this being hinted at by a rate check conducted by the New York Federal Reserve. Traders remain wary of the potential for unilateral action from Tokyo, although the Bank of Japan's data indicates no official market intervention has occurred thus far. The yen's value is also under pressure from political uncertainties ahead of the February 8 snap election for Japan's lower house.