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Economy May 29, 2026 06:43 AM

Japan spent 11.7 trillion yen in currency operations as the yen remains weak

Ministry of Finance records show large-scale yen-buying over the past month had limited lasting effect as the currency returned close to intervention thresholds

By Marcus Reed

Japan's Ministry of Finance reported that authorities spent 11.7 trillion yen, roughly $73.5 billion, on foreign exchange intervention over the past month to prop up the yen. Officials are understood to have intervened around the turn of the month, including during Golden Week when liquidity was thin. Despite the outlay, the yen has returned to levels that initially prompted action, affected by rising energy costs tied to the Middle East crisis and a prolonged period of accommodative Bank of Japan policy.

Japan spent 11.7 trillion yen in currency operations as the yen remains weak

Key Points

  • Japan spent 11.7 trillion yen (about $73.5 billion) intervening in FX markets over the past month to support the yen.
  • Officials appear to have entered the market around the turn of the month, likely on multiple occasions during Golden Week when liquidity was thin.
  • The yen briefly strengthened on April 30 and into May 6 but later weakened again, reaching roughly 159.65 on Thursday; $1 = 159.2600 yen was the reported rate.

Tokyo's Ministry of Finance disclosed on Friday that Japanese authorities deployed 11.7 trillion yen, about $73.5 billion, in foreign exchange intervention over the previous month in an effort to support the yen.

The ministry's summary confirmed market expectations that officials stepped into the currency market around the turn of the month, including likely multiple interventions during Japan's Golden Week holidays when trading volumes were low and liquidity thin.

Authorities moved as the currency weakened past the key threshold of 160 yen to the dollar - the same level that sparked record dollar-selling intervention in 2024. On April 30 the yen moved from a low of about 160.725 to a high near 155.50 in the same session. The currency pushed further to about 155 by May 6, before reversing course and easing back to approximately 159.65 on Thursday.

Market participants and policymakers have cited the impact of the Middle East crisis on Japan's currency. Soaring energy prices have created a terms-of-trade shock for Japan - a nation that imports almost all of its oil - placing downward pressure on the yen. That shock has compounded an existing, longer-term weakening trend that has unfolded alongside the Bank of Japan's cautious approach to monetary normalisation after a decade of heavy stimulus.

The finance ministry's publication on Friday lists only the aggregate amount spent on intervention during the month. A more detailed day-by-day accounting is scheduled to be published with April-June quarterly data, which the ministry indicated will likely be released in early August.

For reference, the exchange rate used in reporting was $1 = 159.2600 yen.

Context and implications

The scale of the outlay underscores the authorities' willingness to act when the yen trades past psychological and policy-sensitive levels, yet the immediate market reaction shows the difficulty of achieving sustained appreciation under current external and domestic pressures.

The ministry's figures provide a headline amount but leave questions about the timing and frequency of interventions until the forthcoming quarterly breakdown is published.

Risks

  • Persistently high energy prices linked to the Middle East crisis could continue to weigh on the yen, creating a terms-of-trade shock for Japan - impacting the energy import sector and broader trade balances.
  • The Bank of Japan's gradual and cautious path toward monetary normalisation may limit domestic forces that would otherwise strengthen the yen, leaving financial markets and exporters exposed to exchange rate volatility.
  • Limited transparency until the detailed daily breakdown is released with April-June quarter data in early August may leave markets uncertain about the timing and intensity of intervention operations.

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