Will Japan bring down the world economy? | The Economist

A rare US-Japan currency intervention has drawn attention to the weak yen, the vast yen-funded carry trade, and the risk that changes in Japan’s interest rates could ripple through US Treasuries, equities and global capital flows. Rare joint intervention The US Treasury joined Japan in supporting the yen for the first time in roughly three decades, with Treasury Secretary Scott Bessent reportedly buying between $5 billion and $10 billion worth of yen. The move stood out not only for its rarity but also because the purchases were made using euros rather than dollars. It followed months of pressure on the Japanese currency and signaled that yen weakness had become an issue of broader international concern.

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• Will Japan bring down the world economy? | The EconomistThe Economist