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US Treasury Secretary Bessent aligns with BOJ to defend yen, warns of unwinding dangerous carry trade
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The article reports that in late July 2026, the US Treasury Secretary Scott Bessent, a former Soros Fund Management executive known for betting against central banks, took the unusual step of aligning with the Bank of Japan (BoJ) to defend the yen. The yen had weakened past ¥163 to the dollar for the first time since 1986. The piece frames Japan as the world's largest carry trader, and its intervention as the beginning of an unwind of a dangerous carry trade. The analysis highlights the significance of a US official cooperating with a foreign central bank in currency defense, contrasting with Bessent's past role in breaking the Bank of England in 1992.
Source report
The world’s biggest carry trader begins to exit its position
Publication date: August 13, 2026 | 5 min read
America’s Treasury secretary, Scott Bessent, is used to making audacious bets against central banks. He once worked for Soros Fund Management, the hedge fund famous for “breaking” the Bank of England during the sterling crisis of 1992. But in late July, Mr. Bessent bet the other way, lining up alongside a central bank in defence of its currency. He dipped into America’s foreign-exchange reserves to help the Bank of Japan (BoJ) buy yen, which had weakened past ¥163 to the dollar for the first time since 1986.
This article appeared in the Finance & economics section of the print edition under the headline “A yen for intervention.”
From the August 15th 2026 edition
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US Treasury Secretary Bessent Joins Japan in Coordinated Yen Intervention