US yen intervention puts Bitcoin, risk assets on notice for liquidity flux
The first US-Japan joint yen intervention in 28 years came amid record bond yields and worries about the yen carry trade.
Joint currency interventions in the yen by Japan and the US could ultimately benefit Bitcoin and risk assets.
Washington’s growing coordination with the Bank of Japan (BoJ) points to a potential boost in global dollar liquidity — even as it runs up against a yen carry trade unwind that could squeeze liquidity if it deepens further.
Last week, the US and Japan conducted a rare joint intervention to prop up the yen, which had slid to 40-year lows of 164 per dollar — the first of its kind since 1998. The New York Federal Reserve Bank sold euros, rather than dollars, on behalf of the US Treasury. The sales involved the Exchange Stabilization Fund, or ESF, a stockpile of foreign exchange reserves.