Commentary: There's rational calculation behind Trump's intervention in the yen
The US government is helping Tokyo and intervening on behalf of the Japanese currency. At the same time, the US president is trying to solve three of his own problems.
The ways of Donald Trump are inscrutable. Suddenly, the US President has discovered the value of alliances and is helping Japan, his most important ally in Asia, to halt the decline of its currency. In a surprising move, US Treasury Secretary Yellen has sold euros on a large scale to invest in Japanese yen. According to rumors, this intervention involved a volume of almost 50 billion euros.
This is remarkable for two reasons. Firstly, the USA traditionally intervenes very rarely in international foreign exchange markets. This was the first major coordinated intervention since 2011, when G7 countries - including the USA - had already supported the yen after the earthquake in Japan. The world's largest economy is a leading currency country and does not consider it necessary to engage in monetary policy or even currency manipulation, just as the USA constantly accuse China of doing.
Secondly, the Trump administration has not exactly been notable for its altruistic foreign policy or, more precisely, external economic policy. The opposite is the case: "America first" is not just a slogan, but the essence of the MAGA (Make America Great Again) movement. The global trade chaos that the USA has caused in just a year and a half is a testament to this.
Translated by urgent.news. Machine-written — may contain errors; check the original before relying on it.
