Crypto World
Why the U.S. Stepped In to Prop Up Japan’s Yen Currency
When asked why the United States intervened to support the Japanese currency, U.S. President Donald Trump told reporters aboard Air Force One over the weekend that the U.S. is “always there” for Japan.
“They have a weakening yen, and they wanted a little bit of help,” he said. When questioned over what the U.S. is “getting out of that arrangement,” Trump replied “financial benefit,” but emphasized it’s also “good for the world economy.”
What is behind the fall in the yen?
Japan had already expressed “serious concern” over the yen’s rapid depreciation in March and conducted unilateral intervention between April 28 and May 27.
Despite those efforts, the currency continued to weaken, with the yen sliding to 163.73 per dollar on Thursday before rebounding to 157.57 on Friday.
One reason a stronger yen matters is Japan’s dependence on imported energy. According to the International Energy Agency, Japan remains heavily reliant on imported oil and gas, particularly from the Middle East.
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