Business & Finance
Treasury Secretary Bessent and Senator Warren clash over U.S. yen intervention
Scott Bessent defended the Exchange Stabilization Fund's currency trade while leaving key transaction details undisclosed following queries from Elizabeth Warren.
The short version
- Treasury Secretary Scott Bessent publicly criticized Senator Elizabeth Warren's understanding of foreign exchange markets after she questioned a recent U.S. intervention to buy Japanese yen using euros.
- Bessent confirmed the Treasury exchanged foreign-currency assets from the Exchange Stabilization Fund for yen without extending credit or requiring new congressional funding.
- The official response did not answer specific questions regarding the exact amount of yen purchased, execution rates, current position value, or whether the European Central Bank was consulted.
Key facts
- Treasury Secretary Scott Bessent responded to an August 13 inquiry from Senator Elizabeth Warren regarding the Treasury's decision to sell euros from the Exchange Stabilization Fund to buy Japanese yen.[CNBC]
- Bessent stated that the trade involved exchanging existing Treasury foreign-currency assets for yen, involved no new congressional appropriations, and created no debt owed by Japan.[CNBC]
- Japan spent a record 15.4 trillion yen (approximately $96.5 billion) supporting its currency between July 30 and August 26, according to Japanese Finance Ministry data.[CNBC]
- The intervention represents the first coordinated effort by the U.S. and Japan to bolster the yen since 1998.[CNBC]