Bessent warns yen volatility could ripple through global markets

U.S. Treasury Secretary Scott Bessent is defending Washington’s recent intervention to support Japan’s yen, warning that a disorderly decline in the currency could have consequences far beyond Japan.

In a letter responding to Sen. Elizabeth Warren, Bessent said sharp moves in the yen could trigger “forced unwinds” of financial positions, potentially destabilizing global markets and pushing up borrowing costs for U.S. households and businesses. 

"Disorderly yen markets can trigger forced unwinds, which could destabilize global markets and ultimately raise borrowing costs for American families and businesses," he wrote in the letter sent on Thursday, according to Reuters.