Japan deployed a record $100B in August to intervene in FX markets and support the yen.
Macro & Markets ·
Japan deployed a record $100 billion in August from its foreign exchange reserves to intervene in currency markets and support the yen, marking an unprecedented scale of intervention by the country.
The intervention followed sustained weakness in the yen against major trading partners' currencies. Such operations typically involve direct purchases of yen and sales of foreign currency reserves to increase demand for the domestic currency and arrest depreciation pressure.
It remains unclear whether further interventions will follow or how long the yen gains from this action will persist. The timing and magnitude of any subsequent operations will likely depend on exchange rate movements and economic conditions in the coming weeks.