US Treasury Secretary Scott Besant has warned that the uncontrolled weakening of the Japanese yen could lead to destabilization in global markets. In July, the exchange rate of the Japanese currency fell to about 164 yen per dollar, the lowest level in 40 years.
Earlier, the US and Japan had conducted a rare joint currency intervention. Following that, the yen temporarily strengthened to about 155 yen per dollar, but later the Japanese currency began to depreciate again, approaching the 160 yen mark.
The US Treasury is concerned that further declines in the exchange rate could lead to widespread position closures among investors. The consequences could extend beyond Japan, potentially resulting in increased borrowing costs for American companies and citizens.
