Japan spent a record 15.4 trillion yen in four weeks to defend the yen

Japan spent 15.3993 trillion yen, about $96.5 billion, buying its own currency between 30 July and 26 August, the Finance Ministry said on Friday. It is the largest single intervention round the ministry has ever published.

The previous monthly record was 11.7349 trillion yen, spent over three days in late April and early May during Golden Week. This year's two rounds together exceed 27 trillion yen. That already tops the previous annual record of about 15 trillion yen set in 2024.

How the July operation unfolded

The dollar traded near 164 yen in late July, the weakest yen in about 39 years and eight months. A government source later confirmed that authorities entered the market on 30 July after the dollar printed 163.99 on 23 July. Bank of Japan data from early August suggested that first day alone may have reached 9.6 trillion yen. The confirmed daily record before that was 6.3 trillion yen on 30 April.

On 31 July, during New York hours, Japan and the United States sold dollars together. Finance Minister Satsuki Katayama and U.S. Treasury Secretary Scott Bessent confirmed the joint action on 3 August. It was the first coordinated yen-buying operation in years. Reports differ on the gap. Some accounts said about 15 years. Others said about 28 years since the last joint yen-dollar move of this type. South Korea timed a won-buying operation with Japan's to add weight.

The yen jumped from around 163 per dollar to as strong as 155.20 by 3 August. It then settled near 159.50 from 10 August. A detailed day-by-day breakdown will not appear until quarterly figures, expected in early November.

Why the yen keeps sliding

Markets have been selling the yen on a simple rate gap and a fiscal worry. U.S. policy rates remain higher than Japanese rates, so capital still prefers the dollar. At home, Prime Minister Sanae Takaichi is pursuing heavy fiscal spending without a published plan to pay for it. Traders treat that mix as a reason to stay short yen even after a ministry operation.

Intervention buys time. It does not close the rate gap. Each larger round also raises a capacity question. Tokyo has now spent more than $170 billion this year across two bursts. To show that the war chest is not empty, Washington has said Japan could use a COVID-era Federal Reserve backstop available to major central banks.

What the number changes

A record print tells other central banks two things. First, Tokyo and Washington were willing to act together when the dollar approached 164. Second, even $96 billion in four weeks only moved the rate by a few yen before it stabilised short of the intervention spike.

The next test is whether 159 holds if U.S. yields rise again or if Tokyo announces more unfunded spending. The ministry has said it will not hesitate to coordinate further. That sentence is now backed by the largest monthly total in the data series. It is also backed by a yen that, after the operation, is still far weaker than it was before this year's first slide.