Scott Bessent, the US Treasury secretary, is positioning himself as a strong advocate for the Japanese yen, a stance that aligns with his background as a currency trader and marks a notable shift in the administration's approach to foreign exchange policy.
Reports indicate that Bessent is actively betting on the yen's strength, signaling a departure from the traditional US preference for a weaker dollar to support exports.
This development comes as Japanese authorities have fundamentally altered their strategy for defending the yen.
Tokyo has moved away from public warnings and verbal interventions, opting instead for covert, targeted actions designed to catch short sellers off guard.
The Japanese currency recently climbed to its highest level against the US dollar in more than two years, driven by these undisclosed interventions.
Bessent's public support for the yen adds a new dimension to the ongoing currency dynamics.