US Treasury bought yen in July; Fed made no solo FX interventions in Q3
TLT•The US Treasury bought 79.4 billion yen ($497.37 million) on July 31, in coordination with Japan, to counter disorderly moves in the currency. The Fed said it made no independent foreign-exchange interventions in the July-to-September quarter.
1. Treasury yen purchase
The New York Fed said it bought 79.4 billion yen ($497.37 million) in the spot market on July 31 on behalf of the US Treasury, selling euros from the Exchange Stabilization Fund. It said the purchase aimed to counter what Treasury viewed as disorderly moves in the yen.
2. Coordinated intervention
Japan’s Ministry of Finance intervened by 15.4 trillion yen during the quarter, the New York Fed said. The dollar-yen rate fell from around 164 yen per dollar on July 30 to around 155 yen per dollar on August 3.
3. No solo Fed action
The New York Fed said July 30 rate checks were made solely on behalf of the Treasury, with the Fed acting as the government’s fiscal agent. The purchase was the first US yen-buying intervention since 1998.
