Bank of Japan Data Shows Japan May Have Used About $340 Billion to Intervene in Forex Market Last Friday

Analysis by Bloomberg of the Bank of Japan's accounts shows that Japan may have used 5.33 trillion yen (approximately $340 billion) last Friday (March 31) to intervene in the foreign exchange market to support the yen's exchange rate. This move followed a coordinated action with the U.S. the previous day, aiming to strongly curb speculative moves betting on yen depreciation. The day before this action, Japanese authorities are estimated to have used up to 8.45 trillion yen, which, if confirmed, could become the largest single-day intervention in history. This concentrated operation is expected to set a new high for the month's total intervention, surpassing the previous record of 11.73 trillion yen during the Golden Week in April and May. This action marks the closest policy coordination between Japan and the U.S. in 15 years. U.S. Treasury Secretary Scott Bessent emphasized that the U.S. would not hesitate to take further action, and President Trump described the move as a 'signal of friendship.' Before the intervention, the yen had depreciated to near a 40-year low of 164 against the dollar, but it rebounded to the 155-156 range after the intervention, briefly rising to around 155.23 in early trading on Monday. The U.S. Treasury had previously noted that the yen's long-term depreciation had led to its 'significant undervaluation.' The market is now awaiting Japan's Ministry of Finance's quarterly report this Friday for further details, while expectations for the Bank of Japan to raise interest rates as early as September are also heating up. As Washington officials express concern over yen depreciation, the U.S. and Japan are strengthening their coordination. In its semi-annual foreign exchange report released last month, the U.S. Treasury noted that the yen had depreciated continuously until April 2026, 'leading to a severe undervaluation of the yen.' The report also stated that the normalization of monetary policy would help stabilize inflation expectations and reduce excessive volatility in exchange rates.