The Japanese yen extended its losses on Wednesday, falling 1% against the U.S. dollar after U.S. Treasury Secretary Scott Bessent said the United States is “absolutely not” intervening in the dollar–yen exchange rate.
The yen’s decline accelerated during Bessent’s interview on CNBC, where he reaffirmed Washington’s long-standing strong-dollar stance. He stressed that the administration does not comment on speculation around currency intervention and explained that a strong dollar policy is rooted in “getting the fundamentals right.”
Following Bessent’s remarks, emerging market currencies also slipped to session lows. The Treasury Secretary argued that solid economic policies naturally attract capital inflows, stating that if the U.S. maintains sound policies, investment will continue to flow into the country.
The comments come after a recent period of dollar weakness. Last Tuesday, the greenback dropped about 1.3%, marking its worst daily performance since April 2025. During a visit to Iowa, President Donald Trump publicly welcomed the weaker dollar, calling it “great.”
Bessent also pointed to the narrowing U.S. trade deficit as a factor that should support the dollar. He added that the administration has implemented growth-friendly policies that helped fuel recent stock market gains, while cautioning that past market performance does not guarantee similar results in 2026.
On monetary policy, Bessent said that the latest interest rate decision remains the responsibility of the Federal Reserve. He also confirmed that he discussed the Fed Chair position with President Trump on their return flight from Iowa, noting that no final decisions have been made.
