TOKYO / RankWire.AI / – The U.S. dollar remained sharply weaker against the Japanese yen on Tuesday after coordinated currency intervention by Japan and the United States. Early Asian trading placed the yen near 157.35 per dollar. It had reached about 155.20 on Monday, its strongest level since early May. The dollar traded near 164 yen in late July. That reversal produced one of the yen’s largest short-term advances this year. The currency retained most of those gains during Tuesday’s session.
Japan’s Ministry of Finance confirmed that it bought yen on Friday, July 31, with the U.S. Department of the Treasury. The ministry said the joint action addressed excessive volatility and disorderly movements in the Japanese currency. It linked the operation to a bilateral finance ministers’ statement issued in September 2025. The official announcement did not disclose the purchase amount. The confirmation followed several days of unusually large exchange-rate moves. It also gave markets a formal account of the coordinated operation.
The dollar had climbed to about 163.65 yen on July 30 before falling rapidly. The yen gained almost 4% last week, its biggest weekly rise in two years. Across three trading sessions, it advanced about 5% against the dollar. Monday’s trading pushed the yen to 155.20 before part of the gain faded. Tuesday’s level still left the currency well above its late-July low. The move reversed much of the dollar’s rise during the second half of July.
Coordinated action lifts yen from multidecade low
The intervention placed Japan’s Ministry of Finance at the center of the market response. The ministry directs the country’s foreign exchange operations. The Bank of Japan acts as the government’s agent when officials conduct currency transactions. The U.S. Department of the Treasury coordinated the American side of Friday’s purchase. The operation marked a rare case of joint U.S.-Japan yen buying. U.S. monetary authorities last bought yen in 2011 during a Group of Seven intervention.
Currency markets also tracked the Bank of Japan’s policy decision on July 31. The central bank kept its overnight call rate near 1% by an 8-1 vote. One policy board member proposed raising the rate to 1.25%. The Bank of Japan identified recent yen depreciation as an upside risk to prices. It maintained its 2% price stability target and existing monetary policy guidance. The decision followed the first major currency swing on July 30.
Dollar remains below late-July peak
By Tuesday, the dollar had recovered modestly from Monday’s low but remained below its late-July peak. The yen stayed about 4% stronger than one week earlier. The broader dollar index also remained close to a two-month low. The euro traded near $1.1511, while sterling stood around $1.3427. Japan’s Nikkei 225 share index declined about 0.3% during the Asian session. Currency trading remained centered on the sharp change in the dollar-yen exchange rate.
The yen’s rebound reduced the local-currency price of dollar-denominated assets and imports compared with late-July levels. Japan relies heavily on imported energy, food ingredients and industrial raw materials. The earlier yen decline had increased the domestic cost of many goods priced in dollars. Tuesday’s exchange rate remained far from the 40-year yen low recorded near 164 per dollar. The dollar-yen pair stayed near 157 after several volatile sessions. The coordinated intervention remained the defining event behind the latest market shift.