Secretary of the Treasury Scott Bessant On Wednesday, he shut down reports that the United States could enter the foreign exchange market with the Japanese yen under intervention surveillance and the Americans dollar reaching multi-year lows.
“Absolutely not,” Bessent told CNBC’s Sara Eisen, responding to a question about whether the U.S. was intervening in the foreign exchange market or strengthening the yen.
THE US Dollar Indexwhich tracks the US greenback against a basket of its foreign peers, rose 0.4% on Wednesday following Bessent’s comments. The index saw its the biggest slide in one day since April and fell to its lowest level since 2022.
US Dollar Index, 5-year chart
Reuters reported Last week, the New York Federal Reserve reviewed dollar/yen rates with dealers, citing a person familiar with the matter. Such a move is seen as a precursor to intervention, Reuters reported.
Bessent told CNBC on Tuesday that he had no comment on the report, only saying that the United States has a strong dollar policy.
“The United States has always had a strong dollar policy, but a strong dollar policy requires getting the fundamentals right,” Bessent said.
“If we have sound policies, the money will flow,” he added. “We are reducing our trade deficits, so … that should automatically lead to stronger dollar strength over time.”
Bessent’s comments come a day after President Donald Trump responded, “I think it’s great” when asked if he was comfortable with the current value of the dollar. The dollar index has abandoned more than 10% compared to 12 months ago.
Trump said he saw China and Japan “devalue” their currencies, which he said was unfair. Investors were monitoring possible intervention in the Japanese yen.
“They’re downgrading, because it’s hard to compete when they’re downgrading,” Trump said in Iowa, where he was on a visit focused on his economic record.